Ostwald liquidator resigns after no-confidence vote
THE LIQUIDATOR of failed construction company Ostwald Bros has been forced to resign from the role after losing the confidence of creditors, a source close to the liquidation has claimed.
The liquidator, Price Waterhouse Coopers, has released a report updating the progress of the liquidation of Ostwald Bros Civil Pty Ltd and Ostwald Facilities and Accommodation Pty Ltd, and announcing it would resign as liquidator.
In its report, PWC said it had resigned as liquidator because of an impending merger with PPB, which had relationships with Ostwald Bros companies.
"We believe it in the best interests of all creditors to resign as liquidators of the company, and OBC and OFA and to effect the appointment of new liquidators," PwC liquidator Derrick Vickers said in his covering note.
"To facilitate this in the most cost-effective manner, we are making an application to court to effect our resignation and appoint the new liquidators.
"We anticipate this to be finalised and our handover to the incoming liquidators by July 2018."
It is believed PWC will go to court on Friday to confirm its resignation. It's also believed global consulting firm FTI Australia has been earmarked to replace PwC as liquidator.
The collapse of Ostwald Bros in August last year has left 23 Clarence Valley sub- contractors chasing more than $7 million in unpaid invoices for work on the Pacific Highway upgrade last year.
A source close to creditors said the real reason for the resignation was the Committee of Inspection, a group of creditors who oversee the liquidation process, held a meeting where it voted to call for the removal of PwC as liquidator.
"The telling part of this vote is it received the support of the ATO (Australian Tax Office) and FEG (the Federal Department of Small Business and Jobs' Fair Entitlement Guarantee)," the source said.
"They're both government bodies who would not normally be concerned about the vote, but in this case both said PWC had to go.
"PWC is using the PPB transaction as cover. I note they have not mentioned the Committee of Inspection, FEG and the ATO voted to have them removed."
PwC said the merger was purely to avoid a conflict of interest.
"PwC recently announced a merger between PPB Advisory (PPB) and PwC, with a proposed completion date of August 1, 2018," a spokesperson said. "This transaction will result in some partners of PPB becoming partners of PwC.
"PPB were engaged by the major secured creditor of the Companies prior to the appointment of PwC as voluntary administrators of Ostwald Brothers."