No more news dc, but like everyone else, waiting on confirmation from DGX. Bad news does not get better with age!
It's a strange one. I'm not a lawyer, but have some reading in contract law. Terminating a construction contract mid-build is typically only invoked as a last resort - as the client incurs extra costs with associated schedule blow outs.
In 13 September's minutes of meeting, the Wanneroo council noted that progress payment #5 of over $500K was made in August to DGX, and the completion date of the YSLC was noted again as December 2016, so the project was still on track, albeit some concerns might have been had (but not noted). http://www.wanneroo.wa.gov.au/info/20003/council/10/council_meetings/2
Since then, the City of Wanneroo must have suddenly escalated their internal risk rating and come to the conclusion that the project is in serious jeopardy of not being completed.
DGX's current CEO simply inherited the family business, but Directors Jason Ferris and Jeffery Hill have extensive experience in managing cash flows and finance in construction (http://diploma.com.au/About-Us/Board-of-Directors.aspx), hence one must assume the council doesn't consider the risk cash flow related, as these Directors would not allow the business to become insolvent.
My guess (and I emphasis guess) is that something spooked the Wanneroo Council and they issued a notice to 'show cause' requiring DGX to give reasons why the contract should not be terminated, and DGX couldn't or wouldn't provide it. The council were willing to take a 6 month hit on the schedule, and have to go through another tender process to complete a "brownfield's" site for some major reason...
DGX Price at posting:
0.6¢ Sentiment: Sell Disclosure: Not Held
