Ostwald Bros crisis could bring 'pain across region'
THE potential demise of civil construction firm Ostwald Bros has sent shockwaves through the Darling Downs, as residents and business owners reel from the news the Dalby-based company is in administration.
More than 470 jobs are at risk in Dalby, Toowoomba and across Queensland after managing director and CEO Brendan Ostwald handed the reins over to administrator PriceWaterhouseCoopers yesterday.
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.
"It's a sad day for us all to hear it and I wish them all the best.
"If it does go the wrong way, there will be pain all across the region."
It is understood the decision was mainly based on the company's ongoing contractual disputes with Nexus Infrastructure and works on the Toowoomba Second Range Crossing, as well as Seymour Whyte and upgrades to the Pacific Hwy in northern NSW.
A spokeswoman for Nexus Infrastructure said Ostwald Bros' financial woes were not expected to affect delivery of the Second Range Crossing.
Cr McVeigh said the Western Downs still had plenty of major construction projects in the pipeline that could keep Dalby people employed, even in the face of a potential collapse.
"Council has approved billions of dollars' worth of renewable energy projects," he said.
"From an agricultural point of view, we approve feedlots just about every meeting - all those projects will need construction jobs.
"There is a lot of positive news at the moment, whilst we're disappointed that there is a company that has gone into administration."
PriceWaterhouseCoopers partners Derrick Vickers and Sam Marsden said the process meant all staff would be stood down from work for 48 hours while the administrators carried out a review of the business.
Along with considering potential staff lay-offs and other trading options, the administrators will need to build a list of creditors with the company, many of which could be owed money.
Dalby Chamber of Commerce vice-president Jim Charlton said while it was impossible to know what will happen, the news had already put a dent in local business confidence.
"I'm sure, particularly those who are owed money, businesses would be a bit concerned," he said.
"This sort of news, no matter what happens, is going to affect the confidence of businesses in town.
"They did start from very small beginnings and they've built themselves up to be a significant force in their industry."
A spokeswoman from the NSW Department of Roads and Maritime Services, which is working with Pacific Complete and Seymour Whyte to upgrade the Pacific Hwy between Woolgoola and Ballina, said it was aware of non-payments between Ostwald Bros and its subcontractors.
Ostwald Bros had been working on the project as a subcontractor to Seymour Whyte, who in turn worked under Pacific Complete.