6 February 2019 | Herpreet Kaur Grewal
Interserve has reached a rescue deal with its creditors to prevent its collapse, according to a statement issued by the group.
Following its 21 December 2018 announcement, the board has provided further details on its deleveraging plan.
The key commercial terms of the deleveraging plan have been agreed in principle with all of Interserve's lenders, bonding providers and the Pension Trustee.
The board believes the deleveraging plan will provide Interserve with "a strong balance sheet and the platform to deliver on its strategy".
Debbie White, CEO of Interserve, said: "Agreeing the key commercial terms of the deleveraging plan with our lenders, bonding providers and Pension Trustee is a significant step forward in our plans to strengthen the balance sheet. The board believes that this agreement will secure a strong future for Interserve.
"This proposal has been achieved following a long period of intensive negotiation and has the support of our financial stakeholders and the government. Its successful implementation is critical to the Interserve Group's future and all of its stakeholders. The deleveraging plan will, alongside our 'Fit for Growth' transformation programme, place us in a strong position to deliver our strategy, be competitive in the marketplace and provide a secure future for the Interserve Group's employees, customers and suppliers."
The deleveraging plan is expected to result in Interserve Group's "pro forma net debt reducing to circa £275 million achieved through issuing c.£480 million of new Interserve equity".
Interserve expects to launch the finalised deleveraging plan in the next few weeks. The deleveraging plan will be "subject to approval by Interserve's shareholders".
The company's statement added: "Whilst Interserve's objective remains to implement a fully consensual transaction, Interserve is also actively preparing alternative plans to ensure the proposed transaction can be implemented in the event that shareholder approval is not forthcoming."