Richstone Group Pty Ltd: One of Australia’s biggest plumbing businesses goes under with 150 staff losing their jobs and an astonishing sum owing to creditors

A major plumbing company in Victoria has collapsed with 150 staff immediately losing their jobs.

Richstone Group Pty Ltd went into liquidation in June after a failed restructuring attempt to keep the business afloat. 

The company had just $61 in its bank account at the time it went under, and owes a whopping $22million to creditors, according to documents lodged with the corporate watchdog.

Administrator David Coyne from insolvency firm BRI Ferrier, said in a document filed with ASIC and seen by Daily Mail Australia, the failure of the business ‘appeared to be the debtors not paying their debts in full’.

Staff are believed to be owed up to $816,000 including unpaid wages and superannuation, while $14million is understood to be owed to the ATO. 

Richstone Group started up in 2003, and was placed in administration in March this year, along with seven other related companies.

The company had prided itself on ‘making a difference through plumbing sustainability’. 

Richstone had carried out plumbing services to high-rise apartment blocks and other building developments around Melbourne.

It was also actively working on the $12.6billion Metro Tunnel Project in the Victorian capital.  

Peter Krejci, the other administrator for the company, had earlier shared to LinkedIn that he was ‘delighted’ to have facilitated the restructuring of the firm.

The company had prided itself on ‘making a difference through plumbing sustainability’

‘I am delighted to have facilitated a restructure of the Richstone Group, Victoria’s largest privately owned plumbing contractor saving 150 jobs and averting the chaos, delay and costs to its customers that would have inevitably ensued had it ceased trading without a sale,’ he wrote in March.

‘The Group is currently active on several major projects across Melbourne.

‘The restructure, as an initial step in the Voluntary Administration of the Group, was approved by the Victorian Supreme Court confirming that the sale of the Group’s business and assets to a related entity was done for value and in the best interests of creditors.’

The majority of the business’ assets had been sold off by liquidators for $4.8million. 

Richstone Group blamed worsening market conditions and the Covid pandemic for their revenue plummeting from $65million to just $25million in the past financial year.

Calls to the business went unanswered on Wednesday while the company’s website has been removed. 

Director Shannon Egglestone said in June the company had faced ‘circumstances beyond our control’.

‘We know how hard all Australians are doing it right now and we are also aware of the possible ripple effect an event like this can have on our industry,’ he said at the time.

‘We have been undergoing a restructure so that we can continue to support our staff, customers and suppliers.

‘Our business which had a general annual turnover of $45 million for the past 5 years started to suffer because of circumstances beyond our control.

‘Material costs against fixed priced contracts, construction industry inefficiencies due to the worldwide pandemic and cuts to credit lines.’