Fletcher Building denies BCG's leaky pipe claims
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The news: The trading halt on Fletcher Building has extended into a third day, as the NZ company trades blame with WA builder BGC over burst pipes in Perth homes. BGC has accused Fletcher of shoddy manufacturing after thousands of pipes manufactured by its subsidiary Iplex have burst in newly constructed homes, while Fletcher says poor installation is behind the faults.
The numbers: Iplex pipes have been installed in nearly 12,000 WA homes between 2017 and 2020, and BCG estimates the cost to replace them at $700,000, or $60,000 per home. Fletcher, which called the costings "sensationalist", said significant plumbing failures were only evident in Perth, while BGC claims faults are occurring outside of WA.
The context: The matter has been referred to the ACCC. BGC is also facing a class action over delays and price increases for home building contracts entered between 1 July 2019 and 30 June 2022.
What they said: "BGC’s allegations are unfounded — their view on causation has changed over time," Fletcher Building chief executive Ross Taylor said in a statement.
"Our independent expert advice is that the methodology and hypothesis BGC used is gravely flawed and their findings unsupported."
The sources: ASX Announcement, ABC, Omni Bridgeway Class Action Release
