More than 500 creditors could be owed $169 million by the failed PBS Building companies, a four-month investigation into the Canberra-based construction company has found.
Administrator RSM Australia has handed down a more than 200-page report which outlines the preliminary findings and recommendations following the voluntary administration of five related PBS companies.
But the future of PBS Building may not be known for some time, as administrators seek to postpone the final creditors' meeting until September.
Residential and commercial projects in the ACT, Queensland and NSW came to halt in early March, when the 33-year-old company collapsed.
PBS Building had 24 active projects under way at the time, worth $439 million.
The final creditors' report, lodged with the Australian Securities and Investments Commission on Friday, confirmed more than 500 creditor claims have been received to date.
The potential claims, combined with those already listed on the company books, are estimated to total $169 million, including $55 million for trade creditors.
In a statement, RSM Australia said all claims were yet to be verified and some were "upper-limit estimates".
The administrators believe the final value of claims could be $50 million less, once overlapping claims and payments from project trust accounts were identified.
PBS BUILDING TIMELINE:
- Canberra builder abandons job site amid 'financial strife'
- PBS Building under external administration
- Dozens of home buyers in limbo amid PBS Building collapse
- PBS Building director linked to past $42m business collapse
- Debts rise to $63 million as Federal Court grants extension for second creditors' meeting
- Directors linked to Gungahlin Homestead redevelopment
- Company reports show debts owed to Tax Office and Canberra businesses
The report found the five companies had assets with a book value of more than $50 million. A final value would be determined once asset sales and debtor recovery efforts were complete.
More than $6.8 million worth of construction contract payments owed to the PBS companies were also identified, while a further $1.3 million worth of claims were being considered.
The administrators would pursue the payments under state-based security of payment acts, which they say would ultimately benefit creditors.
PBS became insolvent in February
RSM Australia partner Jonathon Colbran said PBS Building directors had taken steps to save the company from insolvency.
"From our preliminary analysis of the companies' records, we can see that the PBS Building directors took a number of steps to try and navigate through the challenges they were facing, including implementing a three-phase turnaround plan," he said.
The companies became insolvent nearly one month before officially entering voluntary administration, Mr Colbran said.
"However, our preliminary assessment is that the companies ultimately became insolvent on or before 10 February
2023 as a consequence of a number of factors including being unable to secure the necessary level of additional
working capital and additional support, he said.
Mr Colbran said said current and former PBS directors and staff continued to engage with the administrators.
Among the company's projects in Canberra were the Belconnen Markets redevelopment, a Defence Housing project and townhouses in Strathnairn.
What's next for PBS
RSM Australia have until July 7 to hold the second creditors' meeting, when the future of the companies will be determined.
However, RSM Australia partner Jonathon Colbran said the administrators would propose to adjourn the meeting after discussing the report with creditors at a face-to-face meeting in Canberra on July 5.
"The administrators are proposing to adjourn the creditor's meeting for up to 45 business days, meaning a decision about the future of the companies was unlikely to be determined until on or around 6 September 2023,'' he said.
The extra time would enable administrators to pursue outstanding contract payments owed to PBS companies, Mr Colbran said.
"To date more than $4.5 million of the identified SOPA claims have already been determined in PBS' favour," he said.
"These [security of payment act] claims have the potential to produce significant recoveries for the companies - and ultimately creditors - at a cost that is far less, and in a manner that is far more efficient, than if these claims were pursued through the courts.
"A company that is in liquidation cannot pursue such claims under these Acts.''
More to come.
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