‘PAIN BEING FELT ACROSS REGION’
260 Ostwald Bros workers made redundant
THE potential demise of civil construction firm Ostwald Bros has sent shockwaves throughout the Darling Downs, as residents and business owners reel from the news the Dalby-based company handed the reins over to administrator PriceWaterhouseCoopers on Monday.
On Wednesday, hundreds of workers were sacked after the administrators of Ostwald Bros handed down the findings of an initial review.
Derrick Vickers of PriceWaterhouseCoopers said 260 staff were made redundant and 140 workers would remain stood down as he and fellow administrator Sam Marsden continued to investigate the struggling civil construction company.
The decision came after PriceWaterhouseCoopers stood down all staff for 48 hours while administrators carried out a review of the business.
A lifeline may be thrown to 140 employees who have been asked to continue to stand down, pending the outcome of discussions with lead contractors on a number of sites that could see these projects return to operation.
“This is not a decision we have taken lightly, and we explored all options for continuing the entire group’s operations on a business-as-usual basis,” Mr Vickers said.
“Unfortunately the current position of the company is such that this was not possible.
“However, we are in discussions with contractors at several sites and are hopeful that up to 140 employees will be able to return to work early next week.”
Creditors will learn more about the financial position of the company at a meeting on September 6.
On Tuesday, Toowoomba Surat Basin Enterprise executive chairman Shane Charles said the troubles at Ostwald Bros were reflective of the entire civil construction sector.
“Civil construction over the past few years has been really tough,” he said.
“Ostwald Bros aren’t alone – everyone has been doing it tough for the past few years.
“A bit of it was coming off the back of the gas industry – people had geared up for that market, and when that stopped, people were competing for the same work.
“I’m aware of other companies where margins are skinny.”
CEO Brendan Ostwald pointed to ongoing contractual disputes with major projects as the reason for the board’s decision to enter voluntary administration.
Western Downs Mayor Paul McVeigh, who has known Mr Ostwald and his family for years, said a worst-case scenario would cause pain across the region if the company was unable to trade out of trouble.
“We’re extremely disappointed that this has happened – they’re a company that has had tremendous goals,” he said.
“Hopefully they manage through this, but no one can know what will happen now.
“If it does go the wrong way, there will be pain all across the region.”
TOUGH TIMES: Ostwald Bros CEO Brendan Ostwald handed the reins over to administrator PriceWaterhouseCoopers on Monday.