Interserve share price soars after striking lender rescue deal
Interserve was the leading gainer on the FTSE All-Share this morning after the firm yesterday revealed it had secured a make-or-break funding package.
Shares rose more than 12 per cent in opening trading building on a surge of a quarter yesterday. They are currently almost eight per cent higher.
The firm said yesterday it had struck an “in principle” deal with lenders to provide £196.6m of cash facilities and further £95m of critical bonding lines.
Fears have persisted for several months over Interserve’s future. These were exacerbated by the failure of Carillion in January. Like Carillion, Interserve is one of the government’s biggest strategic suppliers.
Read more: Interserve seals “landmark” £200m rescue package
Emerald Investment, the investment house of multi-millionaire Scottish pub and care homes tycoon Alan McIntosh, is one of the lenders providing the new financing. Previous lenders included Lloyds, Barclays, HSBC, RBS, TSB-owner Sabadell and Santander.
However, the refinancing could see up to 20 per cent of Interserve’s shares placed in the hands of the banks as it was forced to hand out warrants to its lenders – these give the group the option to buy Interserve shares at around a tenth of their current value.
Read more: Interserve shares rocket almost 50 per cent