Imtech plans €500m rights issue as losses soar

Aaron Morby 11 years ago
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Struggling building services giant Imtech aims to refinance with a €500m rights issue.

The announcement came as Dutch-based Imtech revised the scale of losses on jobs in Poland and Germany from €100m to €300m, after bringing in new management teams to assess the problems.

After a thorough review of the Adventure World Warsaw project the firm has raised the scale of loss from €100m to €150m.

A new management team at the German business estimates another write-off of €150m is needed after a lower estimation of work in progress and finding losses were being passed on to the future without proper justification.

Gerard van de Aast, CEO of Imtech, said: “The recent developments in Poland and Germany and the related write-downs require a tightening of the quality and effectiveness of our business controls.

“Our financial structure also appeared to be lacking in robustness. By the intended strengthening of our equity and the measures that have been taken, we are laying a solid foundation for the future.”

The group’s financial problems have put back expansion plans for its UK arm, which previously said it aimed to be a £1bn turnover M&E contractor in the UK by 2015.

Paul Kavanagh, who took over as general manager from Jim Steele this year, said that the firm had already planned to streamline to meet changing market conditions in the UK.

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