THE corporate raider Darren Olney-Fraser has warned that apartment prices could plunge at housing projects and retirement villages owned by the embattled Becton Property Group, unless the company can broker a deal with lender Goldman Sachs.
Failure to strike a deal with Goldman Sachs - which last week bought the $200 million debt owed by Becton to Bank of Scotland International for just $100 million - could also see the future of the state government's $1.2 billion Bonnyrigg social housing project thrown into doubt.
Becton is the builder of the Bonnyrigg project, where an 81-hectare government-owned housing estate is being turned into 2433 dwellings.
Should Becton be put into into receivership by Goldman Sachs, the construction company could be forced out of the Newleaf Communities partnership with Westpac, the property maintenance firm Spotless Group and St George Community Housing.
Newleaf holds the rights to build and run Bonnyrigg until 2037.
"If Becton and Goldman Sachs can work together, Becton can once again be a powerful player in property," Mr Olney-Fraser said.
"If Goldman Sachs uses this deal with [Bank of Scotland] to put Becton into receivership, the project at Bonnyrigg will be adversely affected. This would have a big impact on the many families which Becton is helping in partnership with the NSW government."
Becton - once a giant of the Australian construction industry with a market capitalisation in excess of $4 billion - now has just $300 million of assets on its books, $300 million of debt, and a market value of $3.4 million.
The remaining assets include more than 1000 units in retirement villages in Melbourne and Sydney, valued at an estimated $150 million, as well as housing projects at Bonnyrigg and Waterloo in Sydney and Kensington in Melbourne.
"History shows that if a retirement village falls into receivership, there is a major impact on unit values," Mr Olney-Fraser said.
"No potential buyer wants the uncertainly of buying into a village that is controlled by a receiver, or has recently been in receivership."
Mr Olney-Fraser's company, Mariner, is the largest shareholder in Becton, with 18 per cent of the company's shares. Mariner will on Monday seek shareholder approval to exercise options that will take its stake in Becton to 30 per cent. Mr Olney-Fraser will also make a second attempt to join the board.
In November Mariner's chairman, Donald Christie, joined the board of Becton, but Bank of Scotland objected to Mr Olney-Fraser taking a second seat, stating that Mariner could exert too much control of the company.
"Mariner wants two directors on the Becton board, and we won't stop until we get them on," Mr Olney-Fraser said.
"We will convert our options to shares, taking Mariner's shareholding in Becton to about 30 per cent, making it the largest shareholder of Becton."
As the battle for control of the company heats up, Mr Olney-Fraser has taken a swipe at the pay packet of Becton's chief executive, Matthew Chun, pointing out that his $1 million annual remuneration is almost one-third of the company's entire value.
"It's time for Matthew Chun to deliver something out of the [Bank of Scotland] debt sale for shareholders. He has done a great job keeping Becton alive post-GFC, but shareholders have been smashed along the way. "
Mr Chun said he was unable to comment on Mr Olney-Fraser's remarks as Becton was in the midst of a trading halt and due to make a statement to the ASX on Monday.