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outpansberger
17 Januarie 2020
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Liquidation shock By Andries van Zyl
News of the liquidation of the main contractor at the new Makhado Crossing Mall sent shockwaves through the local business community the past week. CMC Koch Konstruksie filed for voluntary liquidation during December, effectively leaving debts of several millions of rands in the local economy. The fear exists that many of the smaller sub-contractors and suppliers will not be able to recover from this loss and may also close their doors. CMC Koch Konstruksie belongs to two brothers, Carl Francois Koch (47) and Charles Martin Clemons Koch (50), originally from Polokwane. The company was appointed as the main contractor to extend the Makhado Crossing Mall. When the project was launched, the estimated development cost was almost R400 million. The developer of this new state-of-the-art mall is the Masingita Group of Companies, in partnership with Investec Properties. The holding company that was formed is Italite. Italite responded to media enquiries this week and said that news of CMC Koch’s liquidation had also come as a shock to them. They were, however, quick to point out that this would not affect the development project and that all nominated sub-contractors had been paid in full. “Under the selected sub-contract agreement, there is a contractual provision for when the main contractor fails to make payment to them that the employer and principal agent can make direct payment,” said Italite in their response.
When did things start going wrong? According to Italite, CMC Koch started showing signs that they were experiencing financial difficulties in May 2019. They explained that the main contractor could appoint sub-contractors to do specialist work on the project. In terms of the agreement, the selected or nominated sub-contractors are covered by a provision that allows the developer to pay them directly, should problems arise. (Contd on P2)
An artist’s impression of the new Makhado Crossing mall upon completion. Image supplied.
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