Interserve shareholders have voted down the company’s deleveraging plans, with the firm now expected to enter administration.
A market announcement released just after 12:30pm revealed that shareholders had opposed the plan 59.4 per cent to 40.6 per cent, LGC’s sister title Construction new reports. A result of at least 50 per cent in favour was needed for it to pass.
Interserve’s directors convened a board meeting after the vote to determine the next steps for the business. Administration is the most likely outcome.
A statement from the board said: “In the absence of any viable alternative, it expects to implement an alternative deleveraging transaction, which is likely to involve the company making an application for administration and, if the order is granted, the immediate sale of the company’s business and assets (i.e. the entire group) to a newly-incorporated company, to be owned by the existing lenders.
“This transaction would achieve substantially the same balance sheet and liquidity outcomes for the group as the deleveraging plan.”
The plan is expected to be completed by this evening, according to the board, which assured customers and suppliers that its operations would continue “as normal”.
Interserve’s shares were immediately suspended from trading following the vote. Shareholders are now likely to lose their entire stakes in the company.
Interserve chief executive Debbie White has previously warned that if a deleveraging plan was not approved at today’s shareholder vote, then the company would enter administration.
Ahead of the crucial rescue vote Interserve’s shareholders and lenders have also clashed over the best deal for the firm.
Earlier this week, rebel shareholder Coltrane Asset Management threatened to sue the company’s executives of their handling of the refinancing and suggested it could buy the firm out of insolvency.