Interserve Strikes Rescue Deal by Handing Control to Lenders

Interserve has struck a rescue deal that will see lenders take control of the company by swapping millions of pounds worth of debt for new shares, giving the troubled outsourcing group a chance of survival, Reuters reported. Racing to avert a collapse like that of peer Carillion, Interserve said on Wednesday it would cut debt by more than half to about 275 million pounds after creditors wrote off loans in return for new equity worth 97.5 percent of the share capital. Existing shareholders, who saw the company lose 90 percent of its value in 2018, will largely be wiped out. A remaining 350 million pounds of debt has been allocated to its profitable building materials business RMDK, which has been ringfenced in a move agreed with lenders and government. Chief Executive Debbie White said the deal was “critical” to the group’s future and all of its stakeholders. “This proposal has been achieved following a long period of intensive negotiation and has the support of our financial stakeholders and government,” she said. Read more