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Llucan,
You could not be more wrong and unduly concerning suppliers to Interserve.
Please re-read my previous post on how the pre-pack administration has been planned.
Look carefully at the sequence of events that I have described. The sequence is the important part.
Only the group plc company will be put into administration. All the other parts of the business will be sold to the lenders as going concerns. These parts are not in administration. Their debts still get paid to suppliers and subcontractors.
Only the shareholders will be left with nothing.
You should not be posting scare stories that unduly worry the supply chain.
The pre pack administration has been very well planned not to affect the supply chain.
Fate has been woefullu wrong in nearly every prediction that he has made regarding Interserve on this board. However, it would appear he's correct regarding the impact on suppliers should pre pack take place. That is if you believe the words of Debbie White.in todays Sunday Times. "White is blunt about what will happen if the debt-for-equity swap is rejected. The accounting firm EY will take over as administrator of the listed parent company. All of Interserve’s trading entities, staff and contracts will transfer to a new, unlisted company owned by the lenders that will emerge on the following Monday, and continue trading normally. “It will be business as usual on March 18 for all of our staff, clients and suppliers,” she said." That said, what is your experience of business as usual, Easy?
Fate.
If the group PLC is the holding company and it goes into administration, all of its subsidiaries also go into administration. These are assets of the holding company.
You can liquidate a subsidiary but not the holding company without the whole group being in administration.
Llucan
You have described Administration not the Pre Pack Administration that has been planned.
ALL THE PARTS OF THE BUSINESS WILL BE SOLD TO THE LENDERS (FOR DEBT) AS GOING CONCERNS BEFORE THE PLC GOES INTO ADMINISTRATION.
Then the PLC Group company (that everyone has shares in) will placed into administration.
Interserve Construction, FM, RMDK etc.. are not put into administration. They continue as before but owned by a new Company set up by the Lenders.
This is what has been long planned and IT WILL NOT AFFECT THE SUPPLY CHAIN.
https://uk.reuters.com/article/uk-interserve-debt/interserve-set-for-pre-pack-administration-if-debt-deal-fails-source-idUKKBN1QQ0MZ
Note the sequence : Interserve companies sold off first, then administration
Easy - be assured as part of the Supply Chain you will not be affected.
This is not a liquidation like Carrillion was.
The shareholders still own the company when you are stating the assets will be sold off, (notably Coltraine) he can object as all the shareholders can to the assets being sold off.
This is not a creditors winding up. There are no petitions to the court.
No debts have yet been unpaid!
The shareholders Coltraine can decide what happens to the company.
In the article it states:
"A pre-pack administration enables the company to sell itself or its assets before it appoints administrators who take over the running of the business to protect creditors".
The shareholdets own the company before it goes into administration. The shareholders can vote for a normal liquidation and administration if it gives the creditors and shareholders more money.
What is unusual with this pre-pack is that the shareholers may not agree to it.
It is all down to how Coltraine reacts in my opinion.
Sorry message got compressed.
Llucan, you are completely wrong, Coltrane are not in control here!
They own 27% of the shares, and can use that to vote against the refinancing if they choose, but they do not have enough votes to guarantee that the board will be defeated. Assuming they defeat the board and the refinancing is blocked, then the board can elect for a pre-pack administration, where all shareholders (including Coltrane) are wiped out.
This will happen over the weekend and the company will continue operating on Monday morning as Fate has stated. Mouchel has been here before, and that is exactly what happened. The quotes below are from the RNS released by Mouchel at 18:01 after losing the vote earlier that day.
"While it is unfortunate that shareholders have chosen not to approve the terms of the restructuring, and in doing so have declined the opportunity to receive the special dividend of 1p per share, the Board is pleased that the restructuring of the Mouchel group's balance sheet can be implemented by an alternative mechanism, by which existing customer contracts and employees will be safeguarded, achieving the objective of securing the businesses' long-term future."
"The Board believes that the group's businesses are stable and that the expected sale and related transactions will provide them with a sustainable capital structure for the future."
"The Company's discussions with its lenders have been successfully concluded. Accordingly, the terms of the alternative plan have now been finalised and the Board expects that the administrators will be appointed imminently and that, following their appointment, the administrators will immediately sell the Company's assets (including the group companies beneath the Company) to a newly incorporated company. It is expected that following completion of the Alternative Plan, this company will be owned by affiliates of the Company's lenders RBS, Lloyds Banking Group and Barclays and management. As the Restructuring was not approved, shareholders will not receive the proposed special dividend and, given the level of existing debt owed by the group, the expected sale by the administrators will result in shareholders not receiving any value for their share holding."
Coltrane & Farringdon between them own 34% of Interserve.
They have stated they will vote against the proposed deal and "burn their equity".
I have had a further look and think Bill tucker was correct in that the Lenders own about 10%. Aberdeen Standard Investments own 5%. I can't find any hard data, but believe Employees and Insiders own about 10%.
So it looks like...
Against the deal 34%
For the deal approx 25%
This leaves about 40% of shares with PIs and IIs - does anyone know the split?
I would estimate that to pass the deal, the company will need above 75% of all shareholders to vote.
This is an important vote, but over 75% seems high.
Also based on comments by some existing shareholders posting on these sites, it does not appear that all existing shareholders are prepared to back the deal.
It will be interesting to see if anything changes moving towards Fridays vote.....but a the moment I would have to say that sadly Administration is looking a very strong possibility now.
Fate, but once the lenders directly own the subsidiaries then the supply chain will have not "self-interested plc" between them and the banks. Now we all know how the banks behave (as self-interested companies themselves). Hence without a "firewall" which was the plc Interserve then there really is no protection for the supply chain - the banks will be free to treat them however the banks want. If I was a supplier in this situation I would probably try and get paid what I was owed and then cease supplying anymore goods on credit - because from the ways the banks have behaved in the past there really is good reason to suspect they will not treat the people they deal with ethically.