Firm rising from liquidation thrives

Infinite Building Solutions is flourishing using the former Mercy Renovators joinery factory, says Infinite managing director Rick Burns. Photo / Duncan Brown

Business is good for Infinite Building Solutions, says managing director Rick Burns.

The former Mercy Renovations employee purchased plant and equipment from Mercy's liquidator after its failure in November, with the loss of 30 jobs and debts of $3 million.

Infinite employed nine staff for its kitchens and bathroom renovations and was pricing "more and more work every week", he said.

"With the bathrooms we're pricing we could do with another builder. We are employing as we need but we don't want to take on more than we can chew.

"We are getting to the limit - I am wanting to cap it off at 12 or 15."

Mercy boasted more than 20,000 house renovations but went into liquidation with work undone in some homes.

Mercy was a one-stop-shop for home renovations, from painting and decorating to new kitchens, bathrooms and building extensions, completing its own joinery from its Orchard Rd factory.

Mr Burns said its links with Mercy were not a problem "purely because we have gone totally away from them".

"We have changed colours and changed the name - we are totally self standing."

Most business came from word of mouth.

"I've got one client I did a little work for after Mercy went under - I did a little bathroom and a little extra work. They've sold and bought another house and we're back there doing another renovation. They've put me on to two other jobs as as well.

"We haven't advertised apart from our sign-written vans. It's just word of mouth and getting out there.

"The building has been sold. We have met the new owners and we are doing quite an extensive job for them as well."

Liquidator David Ruscoe, of accountancy firm Grant Thornton New Zealand, said in his liquidators' six-monthly report the majority of Mercy's assets were sold for $310,000 and its factory leased for six years with a gross rental of $110,000.

It was unlikely unsecured creditors would be paid, with unsecured claims totaling $1,201,765.

"This is made up of 99 creditors' claims totalling $606,735 and 40 unsecured claims from customers in relation to deposits paid to the company totalling $595,030," the report said.

"Given the extent of the company's secured and preferential claims and expected asset realisations it is unlikely, at this point, that there will be funds available for distribution to the unsecured creditors."

The amount owed to employees at the date of liquidation was $70,006. Kiwibank submitted a preferential claim for wages it "specifically paid" leading up to liquidation of $46,604.

"The IRD has submitted a preferential claim for $114,116 in relation to unpaid PAYE, GST and KiwiSaver employee and employer contributions."

Kiwibank was owed $1.5 million, including accrued interest.

"A second-ranking General Security Agreement has been registered by Tumu Hasting Ltd which is owed $135,463.

"At this point we have not investigated the validity of this claim, pending the outcome of the property sale and likelihood of any funds being available after meeting the claims of Kiwibank."