Major building firm faces liquidation

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09-05-2013
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Daily News
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A MAJOR Durban construction group employing hundreds of workers faces liquidation due to competition in the industry and dwindling work.

The New Germany-based Stedone Group was formed in 1978 as Stedone Civils. It operates in the civil engineering, construction, and property development fields.

A business rescue practitioner, Karl Gribnitz, has been tasked with saving the group from liquidation – and the jobs of more than 1 200 employees. The process is expected to take three to six months.

“I am investigating the affairs of the (group) in a comprehensive investigation of all the companies’ finances,” he said.

He said he would be formulating a business plan to present to the company’s creditors and employees.

Gribnitz has taken over the group’s companies and the board has to report to him.

“It’s a private company that has done well in the past, and they are in trouble now because… certain government work was not given to the company, and there is also the economic downturn in the industry to consider, but we can resolve this.”

Stedone Civils, which had received several government contracts in the past, especially from the provincial education and health departments, has seen its contracts decrease in the past few years.

According to its website, the company’s last contract was awarded by the KwaZulu-Natal Department of Education in 2010 for the Masuku Primary School building project in Folweni, south of Durban.

That year, it was also involved in the construction of restaurants at King Shaka International Airport, and other work at Addington Hospital and the Fort Napier mortuary.

A decision on the company’s future is expected between July and October, once Gribnitz had formulated an opinion based on his investigation.

Asked about retrenchments, Gribnitz said, “This is a big construction company, and there is the possibility of retrenchment, but it is the extent… we do not know yet…

“Once the investigation has been concluded, a decision will be made on whether to reduce the company in size, or it could even stay as it is.”

Stedone Group chief executive Brian Bell did not respond to several e-mail and telephone requests for interviews.