Mouchel in rescue deal to save 8,000 jobs

Grant Prior 12 years ago
Share

Mouchel has struck an eleventh-hour deal with its lenders for a financial restructuring that will keep the consultant trading and protect 8,000 jobs.

But shareholders will see their stakes virtually wiped-out with a special dividend of 1p a share the only return before shares are delisted and rendered worthless as the company goes private.

Mouchel bosses have been in intense talks for weeks to strike the debt-for-equity swap which will see RBS, Lloyds Banking Group and Barclays waive £87m of debt in return for a major stake in the company.

The deal still leaves Mouchel saddled with £60m of outstanding debt which the firm described as “appropriate for a company of Mouchel’s size and prospects.”

Mouchel was due to default on its debts by the end of this month and lenders warned the firm would be placed in administration without the proposed restructure.

The deal is now dependent on shareholders’ approval on August 24, but was described as the only viable and deliverable option.

Shareholders have been braced for losses during a period which has seen the firm’s share price plummet.

Early last year Mouchel’s board turned down takeover offers from rivals Costain and Interserve for around 153p a share, saying the £170m offers significantly undervalued the company.

Six months later the then chairman and chief executive resigned as the extent of Mouchel’s financial woes became apparent.

Grant Rumbles, Mouchel’s replacement chief executive, said: “We are pleased to announce today the terms of our financial restructuring, creating a stable platform for the long term future of Mouchel.

“Given the circumstances, we believe the restructuring represents the best possible outcome for all of our stakeholders, safeguarding our existing customer and supplier contracts and preserving job security for Mouchel’s employees.

“Throughout this challenging period, we have continued to work with our customers, suppliers, employees and other key stakeholders to implement our strategic actions and we are encouraged by the progress made.

“With the continued support of our lenders, we now look to take Mouchel forward from here as a privately-owned company.”

Latest news

Mount Anvil wins £275m Westminster estate renewal

First phase of Church Street area regeneration will deliver 400 new homes and a library
4 hours ago

Trio of A47 road upgrades to go-ahead as legal challenge fails

20-month delay adds tens of millions to dualling costs
2 hours ago

Stewart Milne went down owing supply chain £153m

So far 1,375 firms have come forward with unpaid bills
10 hours ago

Skanska and Morgan Sindall win £277m duo of Cambridge jobs

Railpen awards £200m Botanic Place and £77m Devonshire Gardens office jobs
14 hours ago

Morgan Sindall delivers another record year of profit

Revenue tops £4bn as pre-tax profit soars 70% to £144m
17 hours ago

HS2 viaduct blunder over wonky concrete segments

Align JV now drilling out concrete joint as part of week-long remedial work
1 day ago

City of London hots up as 9m sq ft under construction

Investors return to City as "10 Cheesgraters" of floorspace under construction
1 day ago

Four arrested in £140m property fraud probe

Serious Fraud Office investigating collapse of property developer Signature Group
1 day ago

McLaren gets green light for 31-storey student tower

Revamp of historic Birmingham site will provide 759 student beds and 189 apartments
17 hours ago

BT Tower to become hotel

New owner MCR Hotels to transform iconic building
17 hours ago

Plans in for first phase of £1.7bn ID Manchester

Plan to reinvent 1960s Renold Building as a new innovation hub
18 hours ago

London £3bn housing framework out to tender

SMEs allocated slots on London Construction Programme housing framework refresh
2 days ago

BAM wins first major RAAC school rebuild

Contractor seals £46m deal for St Leonards school in Durham
2 days ago

Failed strip out specialist owes £1.5m to supply chain

More than 100 subcontractors and suppliers left with unpaid bills by Type Ten Limited
2 days ago

Councils to turn screw on building owners over fire safety upgrades

Government tells councils to step up legal action against rogue building owners
2 days ago

Green light for £300m Fenland energy from waste scheme

Wisbech incinerator will generate 50MW from half a million tonnes of waste
2 days ago

Multiplex starts on 50-storey Thames tower

Developer green lights construction of latest phase of £3bn Bankside Yards scheme
3 days ago

McLaren lodges fresh Reading Broad Street Mall plan

Town centre scheme will deliver 600 homes in four towers
3 days ago

Beard bags £24.5m Bristol office revamp

Construction to start in April
2 days ago

SMEs star in £3.2bn social housing upkeep deal

Around 85% of Efficiency North's framework winners are local firms
3 days ago

Scottish NHS new building projects delayed for two years

Spending clampdown hits over a dozen planned projects
3 days ago

Balfour M25 workers hold strike ballot

Motorway maintenance crews unhappy with 3.4% pay rise offer
3 days ago

Rainsford Contracts acquires M&E specialist

Expanded contractor will have turnover of £45m
3 days ago

Statom expands with launch of Northern HQ

RC frames specialist now targeting jobs in Scotland and north of England
3 days ago

High Court dismisses Stonehenge tunnel challenge

Judge quashes legal challenge against Government consent for £1.7bn job
3 days ago

£1.5bn Teesside carbon capture scheme consented

Final investment decision expected this year for construction start
4 days ago

First viaduct steel section installed at HS2’s complex junction job

Victor Buyck Steel Construction install first 300t viaduct section
4 days ago

Sister scaffold firms file administration notices

BCM Scaffolding Services and Scaffteq West employ 100 people between them
4 days ago

McLaughlin & Harvey suffers £8.6m loss

Cost inflation and Scottish landfill tax legislation hit Antrim-based group
4 days ago

Regulator opens probe into National Highways delivery

ORR concerned about 'dip in performance' on capital projects
4 days ago

Contractor services