Centre not make or break

THE fortunes of WA construction giant Multiplex are not tied to the $330 million Perth Convention and Exhibition Centre project.

That is the conclusion of industry analysts and WA businessmen contacted by Business News regarding the convention centre project following concerns that the project might not go ahead if Multiplex failed to meet a State Government deadline for fina-ncing by May 28.

However, most agreed any loss of the project, in addition to doubts over the $900 million contract to build a new Wembley Stadium in London, would affect profitability after what has been a lean year for the construction sector.

There is also the kudos of running the biggest public works project in WA on a high profile position, complete with the company’s banners spread across the site for the next two years.

Multiplex did not respond to inquiries by Business News but sources close to management said that the convention centre was not a make or break issue – in the unlikely event it did not go ahead.

“They have dozens of projects across Australia at the moment,” one source said.

Macquarie Equities analyst Stephanie Fisher could not comment on Multiplex because it is not a listed company but she said the industry had been in the doldrums with a number of big ticket projects shelved.

Ms Fisher said that construction companies had costs associated with winning a project but they would not normally outlay signifi-cant amounts before commence-ment.

The loss of a project might affect a listed company more than a private one such as Multiplex because the share price factors in expected profits from business won.

Multiplex has been in the news for a number of reasons in recent days.

The company has been dragged into the controversy in the Construction, Forestry, Mining and Energy Union because of its links to union heavyweight Kevin Reynolds.

And Multiplex boss John Roberts made headlines as WA’s second richest man with his $800 million in assets placing him just behind Kerry Stokes’ $875 million.


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