National corporate regulator ASIC has disqualified Steller Group’s Simon Pitard from managing a company for three-and-a-half years.
ASIC made the announcement earlier this week after an investigation into how the Steller Group of companies were managed.
It found that Steller Cranes, a subsidiary company of the Steller Group, had not kept accurate books or records, had lent funds to related entities without appropriate assessment, had taken on risks despite transferring legal rights and assets to a related entity, and had not complied with legal obligations and had failed to make timely payments and reports to the ATO.
Pitard was a director for 42 companies within the Steller Group, all of which went into liquidation between 2019 and 2020.
Pitard told The Urban Developer that while he accepted ASIC’s decision, he did not accept any allegations of dishonesty.
“While I consider the events the subject of the ASIC ruling to be regrettable, and I accept the penalty handed to me, I consider the relevant events to be the result of unfortunate market forces, and relationship and related issues,” Pitard said.
“I do not accept any allegations of dishonesty or intentional misconduct or wrongdoing made against me.”
ASIC has estimated that a total of $617 million is owed to both secured and unsecured creditors across all 42 companies.
Steller Cranes and Steller Safety specifically owe $6.6 million, $1 million of which is owed to the Australian Taxation Office.
Con Kokkinos of Worrells Solvency and Forensic Accountants lodged supplementary reports as the liquidator for Steller Cranes and Steller Safety, which were used by ASIC in its determination.
ASIC also determined that Pitard had not strategically managed his companies and had failed to provide oversight and monitor activities.
The Corporations Act’s Section 206F allows ASIC to disqualify a person from managing companies if, within a seven-year period, they were an officer of two or more companies that are wound up with a liquidator providing reports of the inability of the companies to repay debts.
Pitard can seek an appeal of the decision via the Administrative Appeals Tribunal.
Pitard rebranded one of the Steller companies, Steller Built, as Goliath Construction Group on May 1, 2019 just before dissolving his partnership with Nicholas Smedley, and announcing the winding up of the Steller Group at Asian hedge fund OCP’s behest, who had bought on McGrathNichol.
OCP was reported to have been owed more than $100 million at the time.
Sydney's Atlas Advisors had also been a lender to Steller.
Smedley is the son of the late Peter Smedley, who built up the financial services group Colonial before selling it for $8.2 billion to the Commonwealth Bank of Australia in March 2000.
Steller Built was not one of the companies in receivership at the time or part of the joint venture between Smedley and Pitard.
Steller Built’s records showed it was a joint venture between Pitard’s wife Skye Pitard’s Pitard Construction Group and Scott Buriss’ SEH Investments.
Skye Pitard is the daughter of aged care entrepreneur Russell Knowles whose family's wealth was estimated at more than $562 million in 2015 by the BRW Rich List.
ASIC records show that Goliath Construction Group changed its name to Pitard One Pty Ltd in May 2020 before then changing it to its current name Multitude Pty Ltd.
Simon Pitard stepped down as director in March 2021 at which point previous director Thomas David Vines, who had stepped down in 2018, was reappointed.
Multitude’s other director Ryan Anthony McMahon was appointed in May 2020 with Shannon John Hill and Scott Burriss stepping down in 2020.
Pitard Two Pty Ltd currently has a 50 per cent stake in PCG Consolidated Holdings which has 100 per cent of the shares in Multitude.
Buriss’ SEH Investments previously held a 50 per cent stake in Multitude.
Pitard told media in 2020 that he didn’t own any assets and that he was expecting to be served bankruptcy notices by OCP and that he would continue to work in construction.
“It's what I have always loved doing—I ran the delivery arm of the Steller Group,” Pitard said.
“I was never the money man.
“I was the guy who got buildings built and they were good quality builds."
Both Pitard and Smedley were the former developers for the $80-million Continental Hotel project in Sorrento on Victoria’s Mornington Peninsula in 2018 with hotelier Julian Gerner.
Gerner then tried to sell the hotel in 2019 but LBA Capital was unable to commit to purchasing with courts freezing its assets during a dispute with its South Korean investors.
Victoria’s Supreme Court ruled in 2020 that the property was free to sell and in April 2020, the Continental Hotel Group, a consortium of the Smorgen Group, Kanat Group and Trenerry Property, announced new $100-million plans for the property’s redevelopment.
In April 2021, IHG Hotels and Resorts joined the deal as the hotel operator, rebranding the project as the Intercontinental Sorrento.