Interserve lenders seek to wrest back control
INTERSERVE’S largest lenders are plotting to wrest control of the outsourcer in a debt for equity deal that would see long-suffering shareholders wiped out.
The Sunday Telegraph understands Interserve’s lenders have lost faith in the troubled company’s management since its first round of rescue talks earlier this year.
Banks including RBS, HSBC and BNP Paribas, together with Emerald Asset Management and Davidson Kempner Capital, intend to force a fresh debt deal on the company which will hand control to the lender group.
The fresh restructuring will include a debt for equity swap set to deliver heavy losses for its institutional investors and all but wipe out value for public shareholders.
It follows just months after the lender bloc through a financial lifeline to the outsourcer to avoid a Carillionstyle collapse. Since then the company has revealed that its growing debt pile will climb higher than first thought to between £625m to £650m for the year.
A spokesperson said: “Since Sept 2017, new management have reduced costs, significantly increased operating profit, and secured financing allowing time to negotiate a more sustainable, long-term capital structure. Management and lenders continue to work constructively together and, as previously stated, Interserve will announce a deleveraging plan in early 2019. The fundamentals of the business are strong and the Board is focused on securing the right financial structure to ensure Interserve’s future success.”