We’re proud to have been nominated for the TMA Australia 2023 Awards ‘Medium Turnaround of the Year’ for our successful restructuring of Mahercorp Pty Ltd.
We achieved the first successful post-pandemic restructure of a major Victorian domestic home builder, in collaboration with Ashurst, Mawson and Gilbert + Tobin.
The formal restructure of Mahercorp, accomplished through a Deed of Company Arrangement (DOCA), stands out as a unique achievement.
Mahercorp’s building license is retained and the Victorian Managed Insurance Authority (VMIA) supported an increased facility.
All building activities have fully resumed, preserving jobs for its employees, and delivering a positive outcome for creditors including the company’s 1,700 customers.
The restructure’s success factors
The building industry has been hit hard following lockdowns, price increases and labour shortages, creating major challenges for home builders. It’s long been assumed that formal restructures for home builders, have been viewed as highly challenging.
More often than not, the underlying business can’t be preserved or held together, resulting in value erosion and often the breakup or liquidation of the home builder. What makes Mahercorp stand out is that it survived the administration process.
The success of the restructure was due to the delivery of key elements including the pre-appointment planning/communications to post-DOCA sustainability, with a focus on stakeholder management, financial stability (through customer contract variations), and gaining support from regulatory bodies and major creditors.
By incorporating these elements, a formal restructure in the home building industry can more likely achieve success and preserve value.
Barry Wight, Cor Cordis Partner says, “We’re delighted that Mahercorp was successfully restructured, with certainty being provided to its 1700 customers and building activities fully resumed. Many jobs have been preserved and suppliers now have a financially stronger trading partner.”
Thanks to all parties involved in delivering this positive outcome and congratulations to all TMA Awards winners and nominees.