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Published 25 February 2013 12:44, Updated 04 February 2014 00:15
Max Beck has largely sold out of the listed developer, Becton, which he founded three decades ago. Photo: Jessica Shapiro
Multi-millionaire developer Max Beck has little exposure remaining to the turmoil of listed developer Becton, which he co-founded more than three decades ago.
The BRW rich lister’s 17 million shares evaporated into about 60,000 in a one-for-200 share consolidation at the end of 2011, which brought the developer’s share price from 0.6¢ to about $1.20.
That price value has fallen significantly since, a fall exacerbated in the past month as equity investors and debt holders now vie for control of the company in a tussle that has helped push down Becton’s share price to 33¢ during February from just under 40c at the start of the month.
Despite Becton’s well-documented cash-flow troubles since the financial crisis, the company holds a number of lucrative projects, including a $665 million urban regeneration project at Bonnyrigg in Sydney’s west, a $414 million mixed-use project in Sydney’s inner suburb of Waterloo, and a retirement business jointly held with an Omani fund.
The company appeared to be on the mend under the leadership of chief executive Matthew Chun, but that has changed abruptly in recent months. Major investors Mariner, Telopea and Titanium have bought in with competing motivations, including restructuring hopes.
They are clashing with the Goldman Sachs-Fortress Investment Group consortium, which bought a debt exposure to Becton at a discount just after Christmas from beleaguered British lender BOS International, and is holding out on crucial debt waivers.
A trading halt was announced on Friday due to negotiations with the Goldman Sachs consortium over the debt waivers, following the announcement of a half-year loss up to four times Becton’s market value.
Investor Telopea removed its director, Andrew Kerr, from the board, with principal Craig Carracher telling The Australian Financial Review he had lost confidence that there was an opportunity to turn around the company and grow it. Telopea had had “no engagement” with the debt holders, he said.
The company could face receivership if it does not negotiate a solution this week.
A previous version of this article stated that Max Beck had sold down his shares since 2011. This was incorrect. Max Beck’s share holding in Becton fell as a result of a share consolidation at the end of 2011.