14/09/2012 - 14:26

Desert Plains goes into administration

14/09/2012 - 14:26

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Mobile accomodation manufacturer Desert Plains has gone into voluntary administration after racking up debts of more than $3 million.

The family business was founded in 2008 and specialised in making large accommodation units. Its previous clients include Rio Tinto, Chevron and Fortescue Metals.

It was working to fulfil a contract for Rio subsidiary Hamersley Iron and a $2 million contract with BHP Billiton when administrator Grant Thornton was called in earlier this week.

Turnover for the 2012 financial year was approximately $16.5 million.

Grant Thornton partner and administrator Matthew Donnelly told WA Business News expressions of interest were being sought for the purchase of the business and construction of partly completed units has been put on hold.

The company’s 35 employees have been made redundant as a result.

“But I’ll be hoping that by about the middle of next week we’ll be able to bring them back to complete the outstanding work,” Mr Donnelly said.

A creditors meeting has been scheduled for next Friday.

Mr Donnelly said the competitive mining services market was most likely to blame for the company’s difficulties.

“This is a very competitive industry; while they made a fantastic product, they struggled to make a profit from that product and there’ll be discussions later on as to what the failures were.”

It’s understood the company had recently built a new manufacturing facility at Henderson.

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