Interserve PLC Update on financing and debt covenants (2772Z)
December 13 2017 - 9:58AM
UK Regulatory
TIDMIRV
RNS Number : 2772Z
Interserve PLC
13 December 2017
News Release
13 December 2017
UPDATE ON FINANCING AND DEBT COVENANTS
Interserve is pleased to announce that it has secured additional
short-term committed funding for the Group. In addition, we have
reached an agreement to defer the test date for compliance with our
loan covenants to 31 March 2018. This provides a platform for
continued constructive discussions with the Group's lenders, with a
view to securing its longer-term funding.
The additional facilities totalling GBP180m comprise a GBP38m
committed revolving credit facility, GBP37m of committed ancillary
facilities, committed bonding facilities of GBP93m plus GBP12m of
additional funding available by agreement with the lenders. The
facilities expire on 30 March 2018.
In order to obtain these facilities, Interserve has agreed to
close out its cross-currency swaps, which hedge exchange rate
exposure on existing US Private Placement loan notes. The proceeds
generated by closing out the swaps of approximately GBP44m will be
used to repay existing borrowings from current bank facilities.
Unwinding the accounting for the sterling value of the debt and the
associated offsetting swap transactions will increase net debt by
approximately GBP10m.
In September, we launched a group wide performance improvement
plan, Fit for Growth, aimed at improving cash and margin
performance. As part of this plan, we initiated a series of work
streams to address our operating model and the cost base of our
operations, as well as ensuring that we are operating in market
segments which are both profitable and offer opportunity for
growth. We will make further announcements about the output of
these work streams in due course and it will form an integral part
of the discussions with our lenders in respect of the longer-term
financing of the Group.
Debbie White, Interserve's Chief Executive, said:
"Securing these agreements puts Interserve on a firmer footing.
Whilst there is still much to do, Interserve has significant
opportunities based upon a strong client base and our dedicated
employees. There is considerable potential for business improvement
across the Group. These short-term committed borrowing facilities,
together with the ongoing work to clearly define the strategy and
commercial structure for the business going forward, will bring
further stability and clarity for our clients, our people and our
shareholders."
Ends
For further information please contact:
Robin O'Kelly, Director of Communications +44 (0) 7786 702526
Rhys Jones, Head of PR, Interserve +44 (0) 7909 605336
Michael Kinirons, CNC Communications +44 (0) 203 2198816
This announcement contains inside information
LEI: 549300MVYY4EZCRFHZ09
Classification: Inside information
About Interserve
Interserve is one of the world's foremost support services and
construction companies. Our vision is to redefine the future for
people and places. 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
listed in the FTSE. We have gross revenues of GBP3.7 billion and a
workforce of circa 80,000 people worldwide.
www.interserve.com
For news follow @interservenews
This information is provided by RNS
The company news service from the London Stock Exchange
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