Interserve in financial rescue talks in UK
Interserve's Middle East business, while unaffected at large, will benefit from stability in the firm's financial situation
Global support services and facilities management (FM) firm Interserve is planning financial rescue talks that will see creditors take control eliminating its retail shareholders altogether.
The UK’s Financial Times reported that the move is part of a plan to avoid Interserve going down the Carillion path.
The FT also reported that shares in the company, which employs 75,000 people worldwide and 45,000 in the UK, plunged more than 70% after the news on Monday morning.
The firm has said that the new of debt-for-equity deal has been supported by its stakeholders that would result in “material dilution for current Interserve shareholders”. It said it intended to announce the plans early next year.
Banks including RBS, HSBC and BNP Paribas, together with Emerald Asset Management and Davidson Kempner Capital, are engaged in negotiating the deal.
Interserve constructs and maintains government buildings, and provides a string of services from nursing in people’s homes to managing probation for the Ministry of Justice.
It has a turnover of £3.2bn — 70% of that comes from the UK government.
fmME had reached out to Interserve’s regional head who commented on the situation in Janaury, after the Cabinet Office in the UK had set up a team of officials to monitor the company following worries over its financial health.
Saeed Ahmed, FM director, MENA had said: “Our most recent set of financial results, six months to the end of June 2017, showed that our international construction and support services business both reported a profit during that period. We also recently announced that our 2017 performance was in-line with expectations outlined in October.”
In the Middle East, Interserve has been in operation since 1981, delivering a range of services. It operates in hospitality; oil and gas; retail; transport and infrastructure.
Interserve employs more than 25,000 (as of 2015) through 18 of its companies established in the region.
On the FM front, Interserve FM, in partnership with Khansaheb, helps maintain several thousand assets across the UAE and the wider Gulf region.