John Kinghorn
THE listed arm of the business empire run by DFO founders David Wieland and David Goldberger has collapsed under the weight of a $44 million Westpac loan.
Verticon called in administrator McGrathNicol late on Tuesday following the departure from the board last week of Noel Henderson, who is locked in a legal stoush with the two Davids over the near-collapse of the DFO empire.
Mr Henderson quit Verticon on Thursday, leaving the decision to appoint administrators to the two Davids and long-time associate Sam Fink.
Company secretary Brett Coleman quit the same day, but remains company secretary of Mr Henderson’s construction company, Contexx.
It is not clear whether the two Davids, valued at $625 million by BRW last year, paid a $7 million fee they owed to Verticon before pulling the plug on the company.
The fee, due before the end of next month, was for Verticon’s consultancy work on a homemaker centre being developed by North Lodge Holdings, a company associated with both Davids.
North Lodge Holdings is funded by a $102.5 million line of credit from US vulture fund Fortress Investment Group that is backed by both Davids’ personal guarantee.
Yesterday, Mr Fink declined to say whether the two Davids had paid Verticon the money they owed it before the company went into administration.
He directed inquiries to McGrathNicol, which declined to comment.
Lawyer Leon Zwier of Arnold Bloch Leibler, who represents the two Davids, could not be reached.
As part of the fallout from the near-collapse of the DFO group in August, Contexx launched a $14 million Supreme Court action against the discount shopping centre chain’s owner, alleging Austexx, which is controlled by the two Davids, wrongly took the money from a joint venture developing the troubled South Wharf shopping complex.
Verticon, originally a crane group, floated in December 2004, raising $50 million from investors and promising a stake in a ”long-established and profitable business”.
Verticon spent most of that money bringing together two existing crane companies, the Queensland-based Seca, owned by the Pagliari family, and Melbourne’s Econ.
Investors paid $1.20 a share to buy into the vision outlined in the company’s prospectus of creating ”the largest tower crane operator in Australia”. But the crane business failed to live up to expectations and, as the share price plunged, the company turned to property development in the shape of consultancy work on the homemaker centre being built by the two Davids near Chadstone.
While a Westpac spokeswoman said the bank was considering appointing a receiver over Verticon, it was unlikely to do so because the loan had long been considered doubtful.