LONDON (Alliance News) - Shareholders of Interserve PLC could lose everything under the terms of a rescue finance plan being discussed between the outsourcing firm and creditors, the Financial Times reported Friday, citing people close to the negotiations.
The newspaper noted that this is the second time this year that Interserve has sought to restructure its finances. Under the terms of the proposed refinancing plan, banks and other debt holders would take a significant loss as part of a debt-for-equity swap, while public shareholders would be virtually wiped out, the FT said.
The company then would seek to raise fresh cash and attract new investors early next year, or go private if this is not successful.
https://www.ft.com/content/dd8e5588-f8b9-11e8-af46-2022a0b02a6c
Late last month, Interserve said it expects to record a significant improvement in operating profit for 2018, although its UK construction business is likely to post a small loss.
Interserve posted a pretax loss of GBP244.4 million on revenue of GBP3.25 billion in 2017. It then recorded a pretax loss of GBP6.0 million on GBP1.67 billion in revenue in the first half of 2018.
The company said year-end net debt was likely to fall between GBP625 million and GBP650 million and said it expects to announce a de-leveraging plan in early 2019.
The one-time FTSE 250 stock has dropped by three-quarters so far in 2018 to a market cap of just GBP36.7 million.
