The company’s German parent Walter Bau filed for bankruptcy after it got into financial hot water and was unable to secure a rescue package with financiers. With no other option Walter’s Australian board called in Melbourne based KordaMentha as administrators.
The company has several large construction projects currently underway, worth about $400 million including the Victoria Park development, Parramatta Railway Station development and the Burnett River Dam in Queensland.
Over the past two years the company has undergone a major restructure under the stewardship of chief executive Michael Frick, appointed in 2003, but was still reliant on funding from the parent company.
The company employs around 1000 workers, owed over $10 million in entitlements with about 450 of these employed by the Mining Division. The Construction Forestry Mining and Energy took action to protect the employees and stopped work at a number of Walter's building sites in Sydney.
"The company has made a major contribution to the Australian construction industry and we hope that the company can trade out of its difficulties, but we will take all necessary measures to ensure the workers are not disadvantaged," said John Sutton, national secretary of the CFMEU's construction division.
Walter’s Mining division has an impressive book of existing projects in the underground coal mining sector including various types of contracts at North Goonyella, Moranbah North, Beltana, Mandalong, Tahmoor, Dendrobium and Westcliff mines. Some of these are development drivage contracts while others are in joint venture with major conveyor equipment supplier, Continental Conveyor.
According to mining division manager Peter Roberts the mining contracts account for about $50 million of the group’s work-in-hand. All the major mining projects are reported to be in profit.
“In the short-term its is business as usual with all mining projects to continue. In the longer-term it is likely the mining division will be packaged as an ongoing entity and sold as a viable business. Whoever picks it up will be getting a bargain,” he said.
Several mining companies contacted by International Longwall News who are employing Walter Mining said they had been informed of the situation by Walter and while they were concerned, they did not see any major risk in the work continuing.
Walter is the second contractor to enter administration this week, after Henry Walker Eltin’s demise Monday.
