16th September 2009

EMBATTLED construction company CMC has gone into liquidation with debts believed to be about $90 million.

Unsecured creditors, subcontractors, suppliers and former staff, who say they are owed $18.4 million, are unlikely to be paid a cent and work sites were closed by security guards yesterday.

Company administrators SV Partners were appointed liquidators yesterday after CMC directors failed to sign a deed of company arrangement to pay creditors.

Directors had 15 days to sign the agreement but refused, leaving creditors furious and calling for an ASIC investigation

Udo Bergmann, who is owed more than $130,000 for plumbing jobs, said he was furious with directors who had earlier agreed to sign off on the arrangement that would have given creditors a guaranteed $2.5 million and a conditional agreement to pay $1.5 million after a building licence was secured.

"What pisses me off is that we agreed on something, we shook hands," Mr Bergmann, the creditors' committee spokesman, said.

"There are some guys out there really pissed off. I would like ASIC to investigate these matters."

Nicky Lonergan, from SV Partners, said it would be unlikely another creditors' meeting would be held.

"Generally what we do now is consolidate, find the assets, realise them and see if there is going to be a return," she said.

"With the guaranteed creditors, their debts, as we finish the projects and they sell all the units off that reduces each time.

"At last look it was at around $70.5 million."

Brisbane-based Northbuild and Gold Coast-based RCS Construction Consultants are understood to be in negotiations with financiers to complete unfinished projects.

Building Services Authority's general manager Ian Jennings said he was disappointed with the decision.

Construction had been stopped on 11 projects across Cairns and Townsville but permission had been granted by the BSA to continue trading. At least two were finished in that time.

"It is disappointing that the directors, Peter Watson and Wolf Odenthal, were not prepared to follow through on the promises they made to creditors, especially after all the hard work undertaken by creditors, the BSA and the administrators to achieve an acceptable outcome," Mr Jennings said.

Mr Watson and Mr Odenthal could not be contacted last night

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