Multiplex’s shareholders and former shareholders are planning legal action against it after claims that it may have misled investors over Wembley Stadium.
The Australian contractor, already the target of a probe by the Australian Securities and Investment Commission, now faces further scrutiny on behalf of disgruntled shareholders.
The move comes as fresh details emerged this week of the multimillion-pound dispute between main contractor Multiplex and steel company Cleveland Bridge, which left the development after a row last summer.
It also emerged this week that Bob Miller, the head of construction at Dutch steelwork contractor Hollandia, has now left the stadium project. Hollandia was brought on to the project last year to replace Cleveland Bridge.
Slater & Gordon, the law firm that is representing the shareholders, said this week that late last year Multiplex was still indicating that Wembley was on track to return a large profit.
Partner Lisa Nicholls said: “But then in February Multiplex announced that the Wembley project would break even instead of making a profit and in May Multiplex announced that in fact the Wembley project would return a £45m loss.”
Over that period shares in the company dropped from A$6.15 to a record low of A$2.27 on the Australian stock exchange. Nicholls said: “Many shareholders suffered serious losses. The question is what Multiplex management knew and when.”
In a separate development, Multiplex was forced to divulge the information about its dispute with Cleveland Bridge after it lost a High Court battle with an Australian investigative television programme that had requested details of claims by both parties that were submitted in the Technology and Construction Court.
The legal claims and counter claims, which run to hundreds of pages, can be viewed on www.building.co.uk.
Multiplex claims that Cleveland Bridge failed to erect the arch properly and detailed alleged problems in its erection. The claim says: “On a date that Multiplex cannot give … but some time before 2003, Cleveland Bridge discovered defects in the arch, particularly in relation to the tolerance and straightness limits specified in the subcontractors specifications.”
The claim says that, as a result, 13 steel members making up the arch were replaced after a check by Babtie, a consultant engineer.
The Australian contractor also gives details of alleged poor workmanship by Cleveland Bridge, with defects, errors and omissions in the designs and or drawings produced by Cleveland Bridge.
Multiplex says it repeatedly requested a revised programme and price from Cleveland Bridge but was never provided with one. Eventually, it is alleged, after meetings between Cleveland Bridge boss Brian Rogan and Multiplex project director Ashley Muldoon, Multiplex claimed that Cleveland Bridge could not provide a fixed price for the contract but instead wanted a cost-plus deal.
The claim also details a row over the valuation of the contract along with evidence pinpointing delays to the programme. Multiplex still insists in the documents that the project will be ready for the FA cup final next May.
Cleveland Bridge has hit back with a series of counterclaims.
The firm denied that it had agreed with Multiplex that the arch would be lifted into its vertical position in March last year and finished in April of that year. In the counterclaim it says it sent a document known as the “delay entitlement programme” to Multiplex in December 2003. The claims asserts that the document states that the arch would start to be erected in the middle of September 2004.
Cleveland Bridge also claims that from September 2002 the programme was subject to continual delay because of design changes. Cleveland Bridge also denies that it found defects in the arch.
The Cleveland Bridge claim says that it suffered delays because defective concrete was poured into the foundations of the arch and that remedial work was carried out to correct the problem. Cleveland Bridge also claims that Multiplex did not make any proper attempt to reach agreement with Cleveland Bridge on a revised programme for the completion of steel work and for a fresh fixed-priced contract. It rejects claims of defective workmanship.
The information was obtain by a television show called Four Corners, the Australian equivalent of the British programme Panorama.
The case is expected to be heard in the High Court next April, a month before the FA cup is due to play at the stadium.