5 Mar 2019 12:56
RESPONSE TO PROPOSAL FROM COLTRANE ASSET MANAGEMENT L.P.
The Board of Interserve (the "Board") makes the following statement after review, with its advisors, of the proposal from Coltrane Asset Management L.P. that was received on 4th March 2019 (the "Coltrane Proposal").
The Coltrane Proposal requires the consent of the lenders, bonding providers and Pension Trustee to be capable of implementation. The Board has asked Coltrane for its consent to share the Coltrane Proposal with these parties and their advisors, but this request has been refused despite the fact that the key terms of their proposal have been made public by Coltrane. The ability to obtain lender support for a materially different deal requiring lenders to take significantly larger write offs, or provide ongoing support, in the short time frame available is therefore unknown.
The Coltrane Proposal requires that the Board immediately halt the implementation of the Deleveraging Plan that was launched on 27 February 2019 and that is subject to shareholder approval on 15 March 2019. In light of the Company's short-term liquidity requirements and given that Interserve's Deleveraging Plan is currently the only fully funded proposal which has the agreement of lenders, bonding providers and Pension Trustee, the Board is unable to consent to this request without risking the future of Interserve together with its employees, pensioners, customers and suppliers.
The Board also notes that the Coltrane Proposal is non-binding and unfunded and remains subject to due diligence. There is therefore no certainty that Coltrane's proposal could be successfully implemented.
The Board will be providing more detailed feedback to Coltrane on its proposal today and confirms that the Board remains open to considering any proposal which provides liquidity and a deleveraging solution that is capable of implementation in the time frame available.
However, the Board continues to recommend that shareholders vote in favour of the Deleveraging Plan, which is currently the only plan that is capable of implementation in order to provide sufficient liquidity, cash and bonding facilities to allow the Group to service short term obligations and secure a stable platform for the business.
Glyn Barker, Chairman of Interserve, said:
"This is a critical time for Interserve. The proposed Deleveraging Plan, recommended by the Board, is the result of a long period of intensive negotiation to align stakeholders behind a plan to strengthen the balance sheet and secure a strong future for the business. It is the only plan today that provides a certain future for Interserve, preserving some value for shareholders while securing jobs, pensions, and continuity of services. In the absence of any other plan that is capable of implementation, further uncertainty continues to risk an outcome in which there is no return to shareholders, including Coltrane, and considerable disruption to the business.
"The Board considers the Deleveraging Plan to be in the best interests of Interserve and all its stakeholders, including shareholders, as a whole. Accordingly, the Board continues to unanimously recommend that shareholders support the Deleveraging Plan and vote in favour on 15 March."
ENDS
This announcement contains forward-looking statements in respect of the Group and its Deleveraging Plan. By their nature, these statements involve uncertainty, known and unknown risks and other factors and therefore assurance cannot be given that any particular expectation will be met. In particular, while Interserve continues to work towards the implementation of the Deleveraging Plan in the first quarter of 2019, there can be no assurance that the Deleveraging Plan will be implemented unless and until agreements have been reached with several parties and until all conditions are satisfied.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION RELATING TO INTERSERVE PLC.
LEI: 549300MVYY4EZCRFHZ09
For further information please contact:
Jonathan Refoy +44 (0) 7880 315877Interserve plc
Martin Robinson +44 (0) 207 3534200Lisa Jarrett-KerrTulchan Communications
About InterserveInterserve is one of the world's foremost support services and construction companies. Everything we do is shaped by our core values. We are a leader in innovative and sustainable outcomes for our clients and a great place to work for our people. We offer advice, design, construction, equipment, facilities management and frontline public services. We are headquartered in the UK and FTSE-listed. We have consolidated revenues of £2.9bn and a workforce of circa 68,000 people worldwide.
www.interserve.com
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