Troubled trucking company Eddie Stobart has reportedly lined up Deloitte to act as its administrator ahead of a shareholder meeting that will decide on its future on Friday.
Shareholders are set to vote on whether to approve a £55m financing package from former owner Dbay Advisors.
The Telegraph reported that if shareholders reject the deal, Eddie Stobart’s holding company will be put into administration.
In a stock market statement today Eddie Stobart said that if the vote is not successful, the company would face an imminent cash crunch, an imminent expiry of a waiver for its financing covenants from its lenders and and no support from its lenders to explore alternative options.
“In these circumstances the lenders would support the board taking steps to achieve the Dbay transaction by an alternative route which would see no return to shareholders,” the statement said.
Former Stobart Group boss Andrew Tinkler’s TVFB vehicle today said it continued to “gather shareholder support” for an alternative financing plan.
TVFB said it would offer a £20m bridging loan following the general meeting, and urged the company to endorse its rescue package or delay the meeting by a week.
It said: “There is no upcoming liquidity issue within the next week.”
Eddie Stobart published correspondence sent last night by its lenders to TVFB’s advisers.
“The banks would, at this stage, only entertain a proposal that saw them repaid in full ahead of the EGM,” it said.
“For the avoidance of any doubt the banks will not entertain any other proposals and are wholly supportive of the DBAY proposal,” it added.
Allied Irish Bank, Bank of Ireland, BNP Paribas, and KBC – which are owed £200m between them – have granted Eddie Stobart a waiver relating to breaches of its credit facility until 13 December.
Rival trucking firm Wincanton pulled out of a potential bid for Eddie Stobart last Monday, blaming a lack of concrete financial information.
Eddie Stobart’s shares were suspended in August after an accounting scandal. It has still not published its interim results.
Eddie Stobart was contacted for comment. Deloitte declined to comment.