Australia's Melbourne construction giant declared bankruptcy, and thousands of people lost their jobs in an instant! Contractors are in arrears for their projects: I also have a home to support
On Thursday, Melbourne-based Australian construction giant Probuild abruptly declared bankruptcy, and its South African parent company, WBHO, confirmed it would enter bankruptcy liquidation, a decision that News Corp. australia reported had put the company's employees and contractors in trouble.
WBHO is also the parent company of 18 other businesses, a decision that has led to thousands of Australians losing their jobs in an instant.
Probuild has about 750 direct employees and thousands of indirect employees, i.e. contractors, who are concerned about bankruptcy.
Probuild has projects under construction across Australia, including 13 in Victoria, 3 in NSW, 1 in Queensland and 1 in Western Australia, where managers have notified workers that they have a week to remove tools from the company's construction site.
A contractor, speaking on condition of anonymity, told News Australia that Probuild owed him hundreds of thousands or even millions of dollars.
He said he has been working with the company for the past five years and has a home to support himself.
He warned: "41% of workers are temporary workers who will be unemployed. Fortunately, my company has other projects. ”
He's not the only one disappointed by bankruptcy. Another contractor was annoyed, saying the situation was "tough" and everyone wanted to keep working.
Another contractor said his former company was also bankrupt and he thought working at Probuild would give him peace of mind, "but neither of us knew what would happen."
Deloitte has been appointed as the Manager and will handle the next steps. The construction industry is currently facing serious headwinds such as rising prices and delays caused by the pandemic.
Last year, Probuild generated revenue of $1.3 billion but profits of nearly $4 million, while the construction project at Queen St 443 brisbane faced a $120 million loss.
To fill the gap, Probuild injected $15 million into the project for a recapitalization.
It is believed that the collapse of Probuild will have a profound impact on the construction industry across Australia.
Bankruptcy expert Andrew Spring worries that Probuild's bankruptcy will trigger a "domino effect" in the construction industry.
He said the company was one of Australia's largest builders and its failure would spark fear within the industry. Probuild is one of only a few major builders in Australia that can complete large-scale projects.
The company built several iconic buildings, including the Melbourne Convention and Exhibition Centre and the new Victorian Police Headquarters, as well as the new glass "IMAX" building in Darling Harbour, Sydney.
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