Troubled property development company Austexx, which owns the struggling DFO chain, is facing another setback after being hit with a $14 million legal claim over a loan relating to the South Wharf DFO project that almost collapsed earlier this year.
Texxcon, a subsidiary of Melbourne-based construction and engineering company Contexx, lodged a writ in the Victorian Supreme Court, alleging Austexx breached the Trade Practices Act over a $14 million loan the company took from a joint venture company that was constructing the South Wharf development.
Austexx’s shareholders include rich list members and Melbourne entrepreneurs David Goldberger and David Wieland.
The company faced collapse in August after struggling under a $1 billion debt load, most of which was related to the struggling South Wharf DFO complex.
However, in September the company orchestrated a deal to sell four DFO outlets and a 50% stake in the South Wharf project to listed property giants CFS Retail for $498 million. This deal is expected to be settled in the coming weeks.
But the law suit is a fresh blow for the company.
According to Texxcon’s claim, Austexx borrowed $14 million from a joint venture company called Nominexx, a company set up to house the joint venture from Austexx and Texxcon.
However, Texxcon claims the loan was not repaid and says Austexx engaged in misleading and deceptive conduct over the deal.
Representatives from Austexx were contacted for comment but were not available prior to publication.
The company is yet to file a statement of defence.
Representatives from Texxcon’s owner Contexx were also contacted but declined to comment.
Contexx is owned by former Multiplex executives Noel Henderson and Simon Gray. The company has worked on many developments with Austexx and previously shared an office building with Austexx.
Interestingly, Contexx’s head office, at 580 St Kilda Road in Melbourne, is also the head office of Golderberger and Wieland’s petrol business Liberty Oil, and property company Verticon, in which the pair own a significant stake.
Noel Henderson is also chairman of Verticon, and sits on the board alongside Goldberger and Wieland.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
