Grant Thornton rejects MIG and Sons’ offer to buy Porter Davis as not being `credible’

A left field offer from a would-be white knight to buy all of collapsed builder Porter Davis has been rejected by the liquidators as not being ‘credible’.

Liquidators have rejected as not “credible” a left field offer from a would-be white knight to buy collapsed construction giant Porter Davis Homes Group.

Melbourne businessman Amit Miglani, who is the chief executive of MIG and Sons, revealed on Sunday that he had submitted a bid to purchase Porter Davis, which went into liquidation last month leaving about 1700 projects in limbo in Victoria and Queensland with another 779 contracts signed.

The offer was to buy the business outright in a move that he claimed would keep all staff employed, protect homeowner deposits, and see all projects under contract completed.

However, a spokesman for the liquidator Grant Thornton Australia said they have engaged with dozens of parties who have contacted them expressing various levels of interest in Porter Davis.

“While we have no reason to doubt Mr Miglani’s intention, we do not believe this is a credible offer to acquire the Porter Davis Group,” he said.

“Mr Miglani has not undertaken any due diligence and is unable to complete a transaction in an expedited time frame which is a key requirement of the liquidators.

“We remain in active discussions with a short list of parties in order to find solutions for some Porter Davis customers, and to otherwise provide clarity to the remaining customers in relation to the status of their build, and options for them to engage with new builders to complete their homes.”

Major home builder Porter Davis has gone bust with work immediately halted on more than 1700 properties across Victoria and Queensland.

Mr Miglani said he was “surprised” by Grant Thornton’s statement and claimed there were significant errors within it.

“At no stage did Grant Thornton say anything to us about the credibility of our offer and if they need further information, we have everything they may need,” he said.

“Grant Thornton has already been told we can meet any timelines that are required. I think creditors have a right to ask why Grant Thornton would want to sell Porter Davis off in bits and pieces?”

Mr Miglani said home buyers and the subcontractors and the staff of Porter Davis should be the only priority.

“We have done significant due diligence and there is no evidence to the contrary,” he said.

“I don’t understand what would motivate a liquidator to try and discredit what may be the best deal for creditors, staff, tradies and homeowners. All we are asking is for our proposal to be given proper consideration by the liquidator.”

Major home builder Porter Davis has gone bust with work immediately halted on more than 1700 properties across Victoria and Queensland.

Grant Thornton said prior to the appointment of liquidators, Porter Davis, with the assistance of its advisers, ran a process to recapitalise the business to raise the funding needed to allow it to continue to operate viably. That process failed to identify a buyer.

Following their appointment, they have engaged with dozens of parties who have contacted the liquidators expressing various levels of interest in Porter Davis assets.

The Grant Thornton spokesman said while there is genuine interest in parts of the group, they have not identified any parties that are willing and capable of taking over all builds for its customers as part of a single sale transaction.

“We are continuing to discuss solutions for parts of the Porter Davis Group and are aiming to be in a position to finalise those discussions within the next week,” he said.

“We also hope to provide further clarity to customers regarding the next steps in completing their build – which for many customers is likely to involve engaging with a new builder of their choice.”

Mr Miglani narrowly escaped a jail after being sentenced to an 18-month Community Corrections Order after being convicted of misusing his clients’ money while Officer in Effective Control of the now defunct MIG Real Estate. He pleaded guilty to misuse of a trust account and is currently undertaking legal proceedings to restore his licence.

However, Mr Miglani said he was going through a difficult divorce and he chose to plead guilty – despite lawyers advice – because he did not believe he could have coped with a long legal battle at the same time as he was facing a difficult separation involving children.

He said he was going through the courts to restore his licence.

Melbourne-based Porter Davis Homes was Australia’s 12th largest builder when it collapsed on March 31. Said Jahani, Matt Byrnes and Cameron Crichton of Grant Thornton Australia were appointed liquidators of 14 companies in the Group.

Last week liquidators said they were locked in talks with 20 replacement builders to help finish some of the 1700 jobs left in the lurch by the collapse.

Grant Thornton has identified more than 250 homes that they expect will qualify for occupation certificates and be capable of contract completions given how close they are to being finished.

The clients who had paid deposits, but where work had not started on their projects have been told they are at risk of losing their uninsured deposits.

Skyrocketing building costs, labour shortages and bad weather have taken a heavy toll on the industry over recent years.

The construction sector hovered between 17 per cent and 19 per cent of total company insolvencies up until the 2018-19 financial year, but according to the Australian Securities & Investments Commission, but now sits at around 27.5 per cent.

In some months it’s reached more than 31 per cent, approaching one in every three insolvencies, a near 50 per cent increase compared to pre-pandemic levels.

In addition to Porter Davis, the roll-call of failed building and construction companies in the first three months of the year includes Lloyd Group, PBS Building, EQ Constructions, Hamlen Homes, Hallbury Homes and LDC.