Spirits were high around the dining table at Beppi’s Italian restaurant in Darlinghurst in 2022 to celebrate the $42 million sale of the Stewart family’s industrial spray paint business MMP Industrial.
asserted
Spirits → din → business
On hand to raise a toast to one of the industry’s biggest business deals were MMP’s wealthy long-time owner David Stewart, his sons, Nathanael and Bartholomew Stewart, and the man buying the company, Andrew King.
asserted
owner → raise → company
To mark the occasion, King gifted the family patriarch a $7400 bottle of Scotch, as well as a bottle of whisky and Penfolds Grange to his sons and fellow company directors.
asserted
King → mark → sons
The evening didn’t just cap off months of due diligence by King.
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evening → cap → King
It was to mark an auspicious start to King’s new business venture.
asserted
It → mark → venture
It didn’t pan out that way.
asserted
It → pan → ?
Instead, it was the start of a nightmare in which King claims he discovered in the months that followed that the company he thought was a money-spinner was actually on the brink of collapse.
uncertain
he → claim → collapse
The claims are detailed in hundreds of pages of legal arguments already before the NSW Supreme Court ahead of an upcoming trial in which King is suing the Stewarts and a slew of Stewart family companies for damages over claims of misleading and deceptive conduct.
uncertain
King → detail → conduct
The Stewarts have launched their own claim over the $3 million balance payable from the $42 million deal.
uncertain
Stewarts → launch → deal
But amid the many claims and counterclaims, an interlocutory hearing has revealed far more serious allegations that involve an $8 million arson attack on MMP’s biggest competitor and a plot to murder its rival boss.
uncertain
that → reveal → boss
The plot thickens
David Stewart has been a force within the car spray paint industry since 2000, when he purchased the Motor Mates business and soon after renamed it MMP Industrial.
asserted
he → thicken → it
By 2006, the MMP business had started to lose tens of thousands of dollars in contracts to a rival company, Stalyce, run by Craig O’Sullivan, according to findings of a NSW Court of Criminal.
uncertain
business → start → Criminal
The relevance of that competition was raised in interlocutory proceedings given King’s claim that he was falsely told when he was negotiating to buy the MMP business that it had no significant competitors.
uncertain
it → raise → competitors
King’s claim is disputed by the Stewarts, but the judgment lays bare the extraordinary sequence of events that surrounded the inter-business rivalry from when MMP’s then manager, Brian Murphy, allegedly ordered one of his staff, Peter Gregory Lomax, to act as a middleman to arrange
uncertain
manager → dispute → middleman
The $100,000 hit job was handed to a recently released prison inmate, Gavin Crosby, who orchestrated a fire that damaged some contents of the Stalyce factory, but didn’t destroy it.
asserted
that → hand → it
When the deadline to kill O’Sullivan passed with no murder, Crosby was told to either do the job or refund the $50,000 advance.
asserted
Crosby → kill → advance
The problem was Crosby had already spent the money, and the job of carrying out the murder was made all the harder when he kept being arrested by police on unrelated matters.
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he → spend → matters
It left Lomax with the task of unsuccessfully trying to find someone else to kill O’Sullivan.
asserted
It → leave → O’Sullivan
Ultimately, O’Sullivan survived the plot unharmed, but a few weeks later the Stalyce factory was destroyed in a blaze that took four hours and 100 firefighters to get under control.
asserted
that → survive → control
Reports of the inferno estimated the damage bill at more than $8 million, and no one has ever been charged despite investigators believing it was deliberately lit.
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it → estimate → million
“As a result of the fire in November 2006, Stalyce’s business lost numerous supply contracts and was set back 10 years,” said King’s barrister Liam Kelly, KC.
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barrister → lose → contracts
The CCA judgment states that following police investigations and given the content of intercepted telephone calls, Lomax was arrested the following year.
asserted
Lomax → state → calls
Lomax initially admitted that Murphy had approached him to “wipe out” both the Stalyce business and O’Sullivan.
asserted
Murphy → admit → business
He described passing on money from Murphy to Crosby to do the job.
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He → describe → job
Lomax and Murphy were both charged with solicitation to murder, and Lomax was given a reduced sentence, given his promise to help authorities by testifying against alleged mastermind Murphy.
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Lomax → charge → Murphy
But things changed between Lomax’s initial admissions and Murphy’s bail hearing.
asserted
things → change → admissions
At the committal hearing that followed Lomax reneged on his testimony against Murphy, claiming he could not remember who asked him to “set the fire”.
uncertain
who → follow → fire
The charges against Murphy were dropped.
asserted
charges → drop → Murphy
In the NSW Court of Criminal Appeal hearing to review Lomax’s sentence in light of his lack of cooperation with the police, his sentence was extended to six years and 10 months.
asserted
sentence → review → years
In the years that followed, O’Sullivan managed to rebuild the Stalyce business and become a significant competitor to MMP, according to King’s barrister Liam Kelly, KC.
Murphy has remained a friend of the Stewart family over a long period of time.
uncertain
Murphy → follow → time
Kelly told the court that Murphy was an integral part of the business as recently as Christmas 2019, when he provided security for the factory because, as David Stewart emailed his sons, “we have recently taken sales from Stalyce”.
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we → tell → Stalyce
By 2021, when the sale of MMP was flagged with Andrew King, the company looked to be in a strong financial position.
asserted
company → flag → position
According to a financial review that followed, the books showed an annual revenue of about $50 million, an average annual profit of about $10 million and more than $13 million worth of stock.
uncertain
books → accord → stock
Sweetening its appeal was what King said he was told was a “long and consistent history of excellent relationships with its customers”, a lack of any real competitors and, despite operating in a tightly controlled regulatory environment, no outstanding issues with the industry regulator.
asserted
he → sweeten → regulator
As part of the sale contract, David Stewart would continue on at the company in a part-time capacity for the first year under King’s ownership.
asserted
Stewart → continue → ownership
But within days of that celebratory dinner at Beppi’s, Stewart allegedly said he wouldn’t be turning up to the office anymore.
uncertain
he → say → office
“You don’t want me here,” Stewart is said to have told King.
asserted
Stewart → want → King
“Everyone is still looking at me like I am the boss.
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I → look → me
I’ll just get in your way, and you need to establish your own style.
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you → get → style
I will work from home.”
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I → work → home
…and 22 more, not listed.
The Aporia
