17/05/2021 - 15:31

Pindan facing uncertain future

17/05/2021 - 15:31

Bookmark

Upgrade your subscription to use this feature.

Former Pindan Group director Nicholas Allingame has launched a multi-million dollar lawsuit against the property giant, as subcontractors walk off their jobs amid rumours about the company’s future.

Nick Allingame claims he is entitled to bonuses based on Pindan's past profits.

Former Pindan Group director Nicholas Allingame has launched a multi-million dollar lawsuit against the property giant in a bid to retrieve outstanding bonuses, as subcontractors walk off the job amid rumours about the company’s future.

Mr Allingame, son of founding director George Allingame, spent two decades spearheading the company’s development division until his employment was terminated when Singaporean company Oxley Holdings moved to full ownership of Pindan Group.

According to a writ filed in the Supreme Court, Mr Allingame claims he signed a contract in 2006 that entitled him to an annual bonus based on the profits of Pindan’s businesses and an extra bonus when the value of a business exceeded $10 million.

In 2011, at the request of Pindan, Mr Allingame claims the two parties entered into a further agreement, which included a provision that he would receive a long service bonus equal to 5 per cent of the value of group entities worth more than $10 million if his employment was terminated after 20 years of service.

The Pindan group of businesses underwent a restructure in 2016, resulting in Pindan Group being appointed the new holding company.

Subsequently, Pindan divested itself of its assets, transferring them to Pindan Group before winding down its trading activities.

Later that year, Oxley Holdings acquired a 40 per cent stake in Pindan for $32 million. 

In the writ, Mr Allingame claims he continued his work for Pindan Group and in correspondence between June and August 2016, it was confirmed that other than his salary, all other conditions of his employment remained unchanged.

Mr Allingame claims Pindan Group, as transferee of the assets of Pindan, assumed the obligations of the 2011 agreement and, as such, was responsible for the payment of his annual bonus in respect of the profits of the company’s entities in 2017 and 2018.

In October 2019, Oxley moved to full ownership of Pindan Group at zero cost after cancelling around $24 million in debt. 

That same month, Mr Allingame’s employment was terminated.

In the writ, Mr Allingame said he was unable to calculate his entitlements because he no longer had access to the accounts of the Pindan Group of businesses, and claims he has suffered a loss as a result of the alleged conduct.

Mr Allingame has now sought a court order which would force the company to pay him the annual bonuses he is allegedly owed for the 2017 and 2018 financial years, as well as damages.

The legal action coincides with revelations today that the construction giant has informed its subcontractors it is unable to pay them.

Business News has spoken to two of Pindan Group’s contractors this afternoon, both of whom confirmed at least seven major contractors were told on Thursday last week the company was unable to pay them, prompting them to walk off job sites on Friday.

According to Oxley's latest annual report, Pindan had annual revenue of about A$300 million and 400 staff - ranking on Business News' Data & Insights as WA's second largest construction company.

The backing of the Singapore group helped Pindan win multiple large construction projects over the past 18 months.

According to the company’s website, it has a suite of projects under construction, including The Brixton apartments in East Victoria Park, valued at $17 million, and the $16 million Clifton & Central apartments in Mount Lawley.

It is undertaking $30 million worth of works in the education sector, including at Hedland High School in South Hedland, a sporting complex at Frederick Irwin Anglican School in Mandurah, and a sports facility at Geraldton Grammar School.

It also has a $3.4 million contract for work on Fortescue Metals Group’s Iron Bridge magnetite project.

Industry sources have indicated the company may have incurred a large loss on a major project in the Pilbara.

One of the company’s biggest projects was a $90 million contract with Rio Tinto for the construction of accommodation at its Gudai-Darri (formerly Koodaideri) iron ore mine.

Business News understands the company may have also encountered losses as a result of a $42 million construction contract it held with the state government for the redevelopment of the Northam Health Service, awarded in December 2016 and completed early last year.

Three weeks ago, Business News revealed Pindan Group entity Pindan Contracting had launched legal action against subcontractor Complete Hire and Sales for allegedly failing to finish work as part of the $90 million contract.

According to the writ lodged in the state’s Supreme Court, Pindan has had to spend $1.1 million engaging other contractors and suppliers to carry out and remediate the non-compliant work and an additional $276,000 on overhead costs.

Pindan Group has been contacted for comment.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options