Wembley firm's soap-opera tale

By Nick Bryant
BBC News, Sydney

The 90,000-capacity Wembley was due to be completed in 2005

Multiplex is a corporate saga with the plot-lines of an Australian afternoon soap.

There is family intrigue, featuring a towering patriarch and an ambitious heir.

There are dream sequences, in which deal-hungry executives have sought to leverage the company's soaring domestic reputation into a truly global brand.

There have been good times and bad, as the delight at landing the contract for the most high-profile stadium contract in the world quickly turned into corporate despair.

With Wembley, Multiplex put on a repeat of the same episode over and over, as the Australian construction giant announced delay after frustrating delay.

I can't imagine the family will ever walk away from Multiplex Mark Wist, Property Investment Research

The founder of the company even had the initials JR.

Now there is another switchback in the narrative: a possible takeover of the company.

The Roberts family, Multiplex's controlling shareholders, have seemingly welcomed advances from a Canadian suitor, Brookfield Asset Management, in a deal which would see this troubled publicly-listed company return to the private realm.

It marks a major turnaround. Since going public in December 2003, Multiplex has projected itself as an integrated construction giant, combining the roles of developer, builder and landlord.

Recovery

This deal would lead to the break-up of the company, and it is uncertain what future role the Roberts family would play.

"I can't imagine the family will ever walk away from Multiplex," says Mark Wist of Property Investment Research.

"But this deal does make life easier, allowing them to put the disaster of Wembley behind them. It gives them the opportunity to come out the other side."

The Wembley delays have been disastrous for Multiplex's reputation

This corporate chronicle begins with John Roberts, a Perth-based businessman who founded Multiplex Constructions Pty Ltd as a private company in 1962.

Reportedly working 20 hours a day, seven days a week, Mr Roberts built up his company with a combination of hard work and hard-nosed deal-making.

A close friendship and profitable business relationship with Alan Bond, the America's Cup-winning property tycoon, also helped. Working in tandem, they transformed the Perth skyline.

A love of horse-racing - Mr Roberts was thought to own some 100 racehorses - also opened up other lucrative opportunities.

Mr Roberts befriended Sheikh Mohammed al-Maktoum, the owner of Emirates airline and the world-renowned Godolphin stables. The friendship is thought to have boosted Multiplex's presence in the Middle East.

Downfall

Intensely private, Mr Roberts did not grant a newspaper interview until 30 years after founding the company, in 1992.

As a result, many analysts were taken aback in 2003 when, after 40 years as a private company, Multiplex floated on the Australian Stock Exchange and opened itself up to public scrutiny.

Clearly the Roberts family prefer, after the episodes of the past three years, to be under less of a microscope Brent Mitchell, Shaw Stockbroking

By then, Multiplex was revelling in the success of the 2000 Sydney Olympics and its construction of Stadium Australia (now Telstra Stadium), which Juan Antonio Samaranch, the Olympic chief at the time, described as the most impressive stadium he had ever seen.

Multiplex's Olympic success helped make the company a stock market darling and provided the launch-pad for the Wembley deal, an even greater prize.

But the task of building a hi-tech home for English football greatly tarnished the company's reputation.

Penalty shoot-outs, offside investors, extra-time construction, cost blow-outs: the Road to Wembley turned out to be a boon for pun-happy headline-writers, but a public relations disaster for the company.

There was also a financial hit. As the company revealed in its annual report last August, the year's loss on the project was A$364m (£138m).

Retreat

Most serious, perhaps, was an investigation by Australia's corporate watchdog, the Securities and Investments Commission, into allegations that the company failed to tell investors promptly enough that a forecast profit on Wembley had turned into a financial black hole.

The investigation ended in December, with Multiplex offering a A$32m compensation fund for investors who got burned by the company's failure to meet its continuous disclosure agreements.

In agreeing to the compensation, however, Multiplex issued no admission of wrongdoing.

That same month, Multiplex was hit by a major class action suit from 45 disgruntled investors, a case which is still ongoing.

At the age of 72, John Roberts died in June last year. Family members thought that the pressure of the Wembley debacle hastened his premature death. In 2005, he had already stepped down as the company's executive chairman.

Until this week, Multiplex was run by Andrew Roberts, an executive with a penchant for polo and Gucci suits, who took over the business from his father.

Along with his brother Tim and sister Denby Macgregor, Andrew Roberts has now taken a leave of absence to avoid any conflict of interest while the Brookfield takeover plays out. It most probably comes as a welcome breather.

As Brent Mitchell, an analyst at Shaw Stockbroking, notes: "Clearly the Roberts family prefer, after the episodes of the past three years, to be under less of a microscope."