A major Australian builder with contracts across the Emirates has gone bust, threatening 2000 jobs throughout the Middle East.
Hastie Group worked on projects worth billions of dirhams in the UAE, including Abu Dhabi's Dalma Mall and Dubai's JAL Towers. Problem contracts in the region are understood to be behind the company's sudden collapse.
Administrators from PPB Advisory were called into run the company this week and more than 40 of its units.
"The administrators will remain in control of the companies that comprise the mechanical, electrical and plumbing (MEP) businesses in Australia as well as operations in the Middle East," said PPB in a statement.
With more than 7000 employees worldwide, Hastie Group grew to become a global name in mechanical and electrical contracting.
In its 2011 shareholder review, Hastie Group said that collection of cash in the Middle East had been a major challenge for the company.
"We remain acutely aware of Hastie Group’s role on major construction projects and are assessing those urgently. We will provide an update to employees and other affected parties as soon as possible,” said Ian Carson, PPB Advisory Chairman of Partners.
Hastie went into administration this week with around US$492.1 million of debt, according to Dow Jones.
The plumbing, air conditioning and refrigeration services had a market capitalization of around A$220 million as recently as last year. But it faced a litany of issues well before A$20 million went missing from its services division and put the final nail in the company's coffin, Dow Jones reported.
Hastie has been trying to renegotiate its debt for over a year. From/thenational