National builder Ebert Construction has gone into receivership with debts of around $40 million, and the future of its 95 staff is in jeopardy with wages being paid day-to-day.
The firm's 15 building contracts - as well as work and payment of dozens of subcontractors - also now hangs in the balance.
John Fisk, one of three PwC receivers of the business with Auckland and Wellington offices, said: "We think the shortfall will be about $40m."
That is the amount of money Ebert could owe to its many creditors, Fisk said, but a precise figure was not yet available and that was only an initial estimate. Creditors would, however, be left out of pocket, he said.
"There will certainly be a shortfall but the extent of it, we don't know yet. There is an asset-owing company but that's not part of the receivership," he said.
"Ninety-five staff were employed. They were all paid up until yesterday and we have given them an undertaking for each day they're' available, they're paid," Fisk said. However what future the staff have remains uncertain.
"That's what we're tying to determine," Fisk said. "We have suspended all work while we are dealing with each contract. We're talking to the principals [mainly developers or clients]. We want to understand the financial position of each contract. It may be that they have to get other contractors. It may be we can finish some but until we have spoken to all the principals, we don't know what the outcome will be."
Fisk said Ebert's 15 contracts included a new $57m acute mental health unit for Middlemore Hospital, Union Green apartments in Auckland's CBD, Library Lane apartments at Albany in a project which was almost finished, a Synlait plant at Dunsandel in Canterbury, a Synlait job at Pokeno south of Auckland, an air-drying factory at Gore, the new Indian High Commission in Wellington, a contract for Premier Beehive at Carterton and a new fire station in Upper Hutt.
"The board told us they had some unprofitable contracts in the Auckland region and they were aware of them but it was just last week they became fully aware of the problems," he said.
"There are funds in a retention trust account under the new act and we will need to work through that with the lawyers, but it's over $3.5m. That's money to pay creditors if they are entitled to it," he said.
Fisk confirmed Nigel Boyd Foster of Karori, Kelvin Eric Hale of Khandallah and Lawrence Michael Phillips of Wanaka are Ebert Construction directors. Shareholdings are split eight ways.
The receivers' first report is due to be issued two months from the date of the receivership, which was yesterday.
But Fisk said new information would be provided on the PwC website under the Ebert link.