Syntheo will abandon the National Broadband Network when its contract concludes later this year, marking the first departure from the project for a major company.
Syntheo and NBN Co said late Monday night they will not extend Syntheo's contract to build the NBN in South Australia and Western Australia beyond the expiration of the existing contract in November.
Syntheo is a 50-50 joint venture between Lend Lease (LLC) and Service Stream (SSM). Lend Lease said in a statement to the market Monday evening that it will assume all remaining obligations for Syntheo's NBN commitment.
NBN Co said the issue will not affect the planned completion date for the NBN in 2021.
Sources told The Australian that Syntheo grew exasperated with ongoing problems with the rollout and conditions in the NBN agreements that forced Syntheo to take on more risk than it was comfortable with.
NBN Co will have to negotiate with SA Power Networks to take on a larger role in South Australia to compensate for Syntheo's exit, and will have to work with Downer EDI in Western Australia for a similarly broader role in the build.