Ebert Construction's collapse stokes fears of NZ's booming building and construction industry going bust

Fears are growing of New Zealand's booming building and construction industry going bust after the collapse of a major construction firm, Ebert Construction.

The domino-effect could be devastating with experts saying the receivership could be just the tip of the iceberg.

The liquidation of Ebert Construction leaves hundreds of workers and contractors across the country in limbo, facing an uncertain future.

It's estimated at least $40 million is owed to creditors.

Ninety-five workers directly employed by Ebert have been paid until today.

It looks like we've got a dwindling number of firms - Cameron Bagrie, economist

But economists say it's a worrying sign, especially with big players such as Fletcher Building facing tough financial times. 

"We've got a construction sector pipeline that's bigger than Ben Hur, and of course it looks like we've got a dwindling number of firms in regards to being able to meet that pipeline," said economist Cameron Bagrie.

The cost of materials and a shortage of skilled workers are just part of the problem.

"You've got issues in regard to regulatory burdens. You've got issue in regard to the availability of workers. Within the Auckland residential property market, you've got to go up, you've got to go out. You've got issues in regard to infrastructure. You're opening up Pandora's box. It's one hell of a big list," Mr Bagrie said.

PwC receiver John Fisk said a lot of the big contracts are on pretty thin margins, " and so if something starts to go wrong then the losses can rattle up very quickly".

Ebert Construction called in receivers PwC last night after realising the business wasn't viable.

"One thing for sure certain is, we won't be able to complete all the contracts," Mr Fisk said. 

Among the 15 projects affected are a 153-unit apartment block in central Auckland, Middlemore Hospital's new mental health unit and two Synlait dairy projects.

"It'll come down to how much is it going to cost to complete the contract now that Ebert is in receivership and then what resources the developer has," Mr Fisk said. 

With 30 staff, the receivership is quite a shock - Greg Dunn, BCD Carpentry director

Workers from Wellington building company BCD Carpentry grabbed what tools they could from their construction site at the Indian High Commission this morning after Ebert went into receivership. 

"It's taken me 10 years to get where I am. And it's taken these guys, you know working class Kiwis four to five years to get all their tools. And then to be told in the morning you might not be able to have these, the uncertainty was very scary and frustrating for all the men as well as myself," said Greg Dunn, BCD Carpentry director. 

Mr Dunn estimates his small Porirua business is owed tens of thousands of dollars.

"With 30 staff, the receivership is quite a shock," he said.

"Knowing they have families and mortgages and bills to pay, it has huge ripple effects on everyone." 

It comes after the Ebert Construction went into liquidation today. Source: 1 NEWS

Fonterra becomes world's fifth largest dairy company

New Zealand company Fonterra has inched up the ladder to become the world's fifth largest dairy company.

The research was done by the global rural company, Rabobank.

The Swiss firm Nestle retains its top spot with total turnover of $US24.2 billion.

Second is the French company Lactalis, which pushes its compatriot, Danone, down from second to third position.

Fourth comes the US cooperative, Dairy Farmers of America, and in fifth spot is Fonterra, up from sixth.

Half of all the top 20 companies are European while three are American and two Chinese.

New Zealand is the only small country represented.

Turnover of all 20 is up 7.2 percent in dollar terms on last year, due mainly to higher dairy prices.

Fonterra Milking Truck Source: 1 NEWS


Two people dead after crash involving car and train near Palmerston North

Two people are dead after a car was involved in a crash with a train near Palmerston North this afternoon.

Police say they were called to the scene on Troup Road, Woodville around 4:50pm.

Three people were in the car, two are dead and one person is in a moderate condition and is being transported to hospital.

Police investigating the crash have now left the scene and Troup Road has reopened tonight after being closed for several hours.

There were three people travelling in the car which was involved in the crash today. Source: 1 NEWS