THE OWNER of London’s fire engines, AssetCo, has successfully raised £16m through a new share placement in order to tackle its debt problems.
The outsourcing firm, which maintains the capital’s fire engines, was facing serious financial problems and a High Court winding-up petition.
However, the new placement of 160m ordinary shares, underwritten by Arden Partners, will cut its bank debts to about £3.9m by the end of this year.
The issuance leaves shares in the firm massively diluted, with shares closing down at 12p yesterday.
The chairman, chief executive and finance director will now be changed.
Arden analyst Geoff Allum said: “There are no problems with the operation of this company, the problem has been with financial management of its balance sheets. The share price is going to shoot up now, if it doesn’t recover pretty rapidly there are bidders out there and they wont go away.”