At least 1300 Forge employees sacked in WA

Forge is on the verge of being delisted from the Australian Securities Exchange, just two days after its financiers, including ANZ Bank, announced they had withdrawn their support for the company.

南宁桑拿

Receivers KordaMentha said 1300 employees on power stations and mining projects in Western Australia and Queensland were retrenched on Wednesday after the principals of the construction jobs exercised contractual rights on the projects.

“Moves by some of the owners of the projects forced our hand because there is no cash to carry employees,” receiver Mark Mentha said in a statement.

Employees were notified of the redundancies on Wednesday afternoon.

Forge’s clients include mining giants Rio Tinto, BHP Billiton and Gina Rinehart’s Roy Hill Holdings.

Administrators Ferrier Hodgson and receivers KordaMentha were appointed after the company recently reported significant cost over-runs and profit downgrades in power construction contracts.

Mr Mentha said Forge’s financiers had done everything possible to give the company time to find a solution to repair its balance sheet.

The action has left administrators to complete the Diamantina Power Station in Queensland and West Angelas Power Station for Rio Tinto’s expansion in the Pilbara region of WA.

Mr Mentha said Forge employees would receive their entitlements from the sale of Forge assets and the federal government scheme that guaranteed basic entitlements.

“There is no money to pay employees and no work to perform,” Mr Mentha said in a statement.

“We are working closely with the administrators to do whatever we can to help the employees at this dreadful time for them and their families.”

He said the receivers would bring employees back to their home town and help them apply for their entitlements.

One employee told Fairfax radio he is owed eight weeks pay, while 457 visa holders had 90 days to find another job before being forced to leave the country.

Forge had 1,753 employees in Australia and 814 overseas.

Mr Mentha added that Forge’s international businesses in South Africa, Asia and the US would operate as usual ahead of a sale of those businesses.

The development has cast a cloud over the construction of a $1.47 billion processing facility at Gina Rinehart’s Roy Hill iron ore project in WA, which was worth $830 million to Forge.

Meanwhile Opposition Leader Bill Shorten lamented the loss of more Australian jobs following the collapse of Forge Group, calling it a “devastating announcement”.

“Our thoughts are with the workers and their families,” Mr Shorten said in a statement.

The S&P Dow Jones Indices said it will remove Forge Group from the S&P/ASX 200 at the close of trade on Thursday as a result of the company being placed in voluntary administration.

The company will be replaced by Nine Entertainment Co after the close of trade on February 19.

The decision to appoint administrators came less than a fortnight after Forge said it expected to post a full year loss of up to $25 million.

In December, Forge announced writedowns of $127 million associated with its Diamantina Power Station in Queensland and West Angelas Power Station for Rio Tinto’s expansion in the Pilbara region of WA.

The first meeting of creditors is scheduled to take place in Perth on February 21.

Author: admin