{"id":8384,"date":"2019-03-10T08:46:52","date_gmt":"2019-03-10T08:46:52","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/interserve-facing-crucial-vote-on-rescue-plan\/"},"modified":"2019-03-10T08:46:52","modified_gmt":"2019-03-10T08:46:52","slug":"interserve-facing-crucial-vote-on-rescue-plan","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/interserve-facing-crucial-vote-on-rescue-plan\/","title":{"rendered":"Interserve facing crucial vote on rescue plan"},"content":{"rendered":"\n
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\n Interserve holds the contract for cleaning Network Rail stations
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Interserve, one of the UK’s largest providers of public services, is urging shareholders to back a rescue deal or the firm could face administration.<\/p>\n

Last month it reached a deal with creditors to prevent its collapse.<\/p>\n

But if shareholders reject its debt-for-equity-swap plan in a vote this Friday, Interserve’s lenders could apply for a pre-pack administration.<\/p>\n

This would mean the firm avoiding a Carillion-style collapse, but would wipe out existing shareholders. <\/p>\n

A pre-pack administration enables a company to sell itself, or its assets, before it appoints administrators – who then take over the running of the business to protect creditors. <\/p>\n

In a pre-pack, the lenders take 100% of the business.<\/p>\n

Watered-down holdings<\/h2>\n

Interserve’s rescue plan involves cutting its debts from more than \u00a3600m to \u00a3275m by issuing new shares. These will then be swapped with creditors for debt.<\/p>\n

However, if shareholders do vote to approve the rescue deal, which would hand 95% of the firm to lenders, it would leave them with with heavily watered-down shareholdings.<\/p>\n

Interserve’s largest shareholder, Coltrane Asset Management, is critical of the deal and is threatening to block it unless there is a better deal for shareholders.<\/p>\n

Interserve sells services, including probation, cleaning and healthcare, and is involved in construction projects.<\/p>\n

Share plunge<\/h2>\n

Under the rescue deal, Interserve will also keep its most profitable division, its RMD Kwikform construction business, loading \u00a3350m of debt onto its balance sheet.<\/p>\n

The firm had considered spinning the unit off to its lenders to raise money. <\/p>\n

This is the second rescue deal for Interserve, with the company refinancing its debt in March last year.<\/p>\n

Its troubles have been blamed on cancellations and delays in its construction contracts as well as struggling waste-to-energy projects in Derby and Glasgow. <\/p>\n

The firm’s shares have plunged over the past year, currently trading at 14.6p each. Just over a year ago, the shares were worth 100p each. <\/p>\n

Following Carillion’s collapse, the government launched a pilot of “living wills” for contractors, so that critical services can be taken over in the event of a crisis. Interserve is one of five suppliers taking part.<\/p>\n

What does Interserve do?<\/h2>\n

From its origins in dredging and construction, the company has diversified into wide range of services, such as healthcare and catering, for clients in government and industry.<\/p>\n

At King George Hospital in east London, for instance, Interserve has a \u00a335m contract for cleaning, security, meals, waste management and maintenance.<\/p>\n

Its infrastructure projects include improving the M5 Junction 6 near Worcester, refurbishing the Rotherham Interchange bus station in Yorkshire, and upgrading sewers and water pipes for Northumbrian Water.<\/p>\n

Interserve is also the largest provider of probation services in England and Wales, supervising about 40,000 “medium-low risk offenders” for the Ministry of Justice.<\/p>\n<\/p><\/div>\n


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Image copyright Creative Commons Image caption Interserve holds the contract for cleaning Network Rail stations Interserve, one of the UK’s largest providers of public services, is urging shareholders to back a rescue deal or the firm could face administration. Last month it reached a deal with creditors to prevent its collapse. But if shareholders reject … <\/p>\n","protected":false},"author":0,"featured_media":8385,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-8384","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/8384","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=8384"}],"version-history":[{"count":0,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/8384\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media\/8385"}],"wp:attachment":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=8384"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=8384"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=8384"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}