The company is part of the Catcorp Group, owned by Sydney construction industry figure Sam Catalano. The company was placed in the hands of administrators Brian Silvia and Andrew Cummins of insolvency firm BRI Ferrier in late January, although receivers have also been placed over parts of the group.
According to documents presented by administrators at the first creditors meeting on February 4, Austruc, which has been in operation since 1986, has 11 projects underway at the time of its collapse, including a 51-unit residential development for another company in the Catcorp Group, Optima Property development.
However, Silvia and Cummins says it appears little can be salvaged from the Austruc work book.
"All of the existing projects appear to be unprofitable to complete, as evidenced by the fact that arrangements had been made for clients to pay sub-contractors direct," the administrators said in the report to creditors.
The report also highlights a complex web of inter-connected companies within the Catcorp Group, with many of the companies holding loans to other companies within the group.
Austruc's biggest debtor is a related company called Padas, which it provided with $19 million in loans.
According to the report to creditors, Austruc owes $8.5 million to secured creditors including the ANZ Bank, although about $4.5 million should be realisable in property sales.
However, a whopping $17.9 million is owned to unsecured creditors, most of whom are subcontractors who have been working on the group's project.
The collapse of Austruc is another bitter blow for these contractors, who have seen several building companies go to the wall in the last 12 months, including Wincrest, Kingstone Homes and Pacific Blue Homes.
According to The Age, the NSW state secretary of the Construction Forestry Mining & Energy Union, Andrew Ferguson, has written to Premier Kristina Keneally, requesting urgent action to improve the state's security of payment system and protect subcontractors.
