Former Infracon employees paid $3m

Darren Mason, former chief executive of Infracon, was praised by the liquidators. Photo / Christine McKay

Liquidated roading company Infracon was sold to Higgins Aggregates for $7.6 million, with former employees receiving almost $3 million.

Infracon was 66 per cent owned by the Tararua District Council, with the Central Hawke's Bay District Council owning 34 per cent. The company was put into liquidation in August last year.

Liquidators John Fisk and Tony Pattison of accountants PricewaterhouseCoopers had assessed core parts of the business and decided some divisions of the company couldn't viably continue to trade, which resulted in the redundancy of 98 staff, with 113 staff remaining employed.

Throughout the course of the liquidation a small number of staff left of their own volition, or were made redundant as contracts ceased with the Tararua District Council.

In a liquidator's report released last week, Mr Fisk acknowledged the considerable assistance received from Infracon staff who remained employed, particularly the chief executive Darren Mason.

This resulted in the company being able to cover its own trading costs, as well as the liquidators' costs, while the Central Hawke's Bay division, the aggregates division and the energy division were marketed for sale.

Although four parties went through due diligence, Infracon was ultimately sold to Higgins for $7.6 million. Employee preferential claims of $2,994,011 have been paid in full and the liquidators expect Inland Revenue will also be paid in full once its claim is received.

However, the Tararua District Council will have to wait until Infracon is fully wound up before it finds out the financial result for the council.

"We'll have to wait another six months, because until then we won't really know what will happen," Tararua District mayor Roly Ellis told the Dannevirke News.

"It's good that employees have been paid up and I would like to think all those owed money by Infracon will be paid as well. One of our reasons for putting the company into liquidation was that if it (Infracon) had dropped another $2 million in losses, those people wouldn't have been paid."

The liquidators say a partial distribution of 95 per cent to 100 per cent will be made to unsecured creditors at the end of this month.