Shareholders reject Interserve rescue plan

Interserve shareholders have rejected the proposed rescue plan leaving the board likely to file for administration.

Around 60% of the votes cast rejected the proposed the debt for equity swap which would have given lenders 95% of the business and left shareholders with just 5%.

Interserve board of directors is now holding an urgent board meeting to consider its options.

The most likely course of action will now be to file for administration with the business and assets passing to a newly-formed company owned by lenders later today..

It is hoped this pre-pack deal would protect much of the 45,000 strong UK workforce and pensions. But there have so far been no assurances about what this move holds for Interserve’s existing unsecured subcontractors and suppliers.

In a statement following the vote, the board said: “In the absence of any viable alternative, it expects to implement an alternative deleveraging transaction, which is likely to involve the company making an application for administration. “

It added that if the order was granted, it would trigger the immediate sale of Interserves’s business and assets to a newly-incorporated company owned by existing lenders. 

This transaction would achieve substantially the same balance sheet and liquidity outcomes for the group as the Deleveraging Plan.

“The alternative transaction will be implemented very quickly and via a carefully-managed process and the administration and sale is expected to be completed this evening, ensuring that the business will continue to operate as normal for customers and suppliers. 

“It will provide the group with a strong financial position, allowing it to grow and develop the business, to deliver on its long-term strategy and protect the group’s employees (including the beneficiaries of the Group’s pension schemes).”

Interserve shares were suspended from trading on stock market immediately.

from Construction Enquirer http://www.constructionenquirer.com/2019/03/15/shareholders-reject-interserve-rescue-plan/

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