Friday March 31, 9:19 PM
Multiplex set for court over Wembley
Multiplex Ltd has reportedly withheld all late-delivery penalty
payments for non-completion of Wembley in a dispute that threatens to
go to court.
The contract between the FA - through its subsidiary Wembley National
Stadiums Ltd (WNSL) - and Multiplex stipulates payment of STG140,000
($A343,137) per day by the Australian company for each day beyond the
original January 31, 2006 delivery date.
However Multiplex was reportedly preparing to argue the point, saying
late specification changes by WNSL caused the delays.
"We believe they have made enough design changes that would entitle us
to extensions of time," an unnamed Multiplex insider said in The
Guardian newspaper.
"So far we have not had a single hour's extension.
"But we believe we are entitled at the minimum to the end of September
this year - an eight-month extension.
"That's being conservative.
"The reality is that it could stretch way into next year."
Multiplex expected building work on the stadium in north London to be
substantially completed by the end of June at the earliest.
However the FA said it would not be totally finished until the end of
September, with a further two months of test events then required,
hence the cancellation of all 2006 events.
That includes the FA Cup final, August's Community Shield - the
traditional Premier League curtain raiser between the league champions
and FA Cup holders - two England qualifiers for Euro 2008, rugby
league's Challenge Cup final and concerts by Bon Jovi, Take That, the
Rolling Stones and Robbie Williams.
The Guardian reported the transferral of these events and costs
associated with the re-development could cost the FA STG32 million.
Multiplex now hopes to have the contractor's works substantially
completed by the end of June, but has advised client WNSL that it has
grounds to extend the contract until at least September.
"Notwithstanding that it is Multiplex's belief that it has until at
least September to complete, Multiplex is targeting substantial
completion by end of June," Multiplex company secretary Mark Wilson
said in a statement.
However even if Multiplex hits it June-end target, further works such
as commissioning and cleaning need to be completed after this date.
The company had been working towards completing the stadium by May,
despite the fact that the English Football Association (FA) had
scratched plans to hold the May 13 FA Cup final there because of the
delays.
A Multiplex spokesman said that WNSL bore responsibility for the
scheduling program.
"As the client has chosen not to integrate their works and operational
activities, these works will complete after our forecast date for
substantial completion of the stadium," he said.
"The question of events therefore rests with WNSL and the Football Association."
WNSL has decided to hold off on its own works at the stadium until
after Multiplex has finished, departing from the original plan for an
integrated approach.
"Multiplex's client, Wembley National Stadium Ltd, is solely
responsible for determining when it starts and completes its works and
also when and which events are hosted at the stadium," Mr Wilson said.
Multiplex does not expect further adjustments to the project's
financial position following additional allowances in the company's
latest interim results to cover any further unforseen delays.
Multiplex posted a $119.6 million net loss for the first half of
2005/06 after taking a $250.7 million after-tax hit from Wembley
losses for the period.
Its total losses from the project have topped STG200 million ($A475 million).
The project had originally been scheduled for completion on January 31.
Multiplex shares closed three cents lower at $3.07 on Friday.
MXG
multiplex group
