From the resignation of CEO Adrian Ringrose in November 2016 to its rescue plan being vote down in March 2019, CN charts the key events that led to firm’s potentially fatal problems.
More from: Interserve files for administration
14 November 2016 – CEO Adrian Ringrose steps down
Adrian Ringrose chief executive Interserve
Dogged by losses from energy-from-waste contracts, a failed attempt to diversify into large-scale commercial works and an impending announcement of pre-tax losses of £94.1m, CEO Adrian Ringrose stepped down as CEO in November 2016 after 15 years at the helm.
7 March 2017- Debbie White appointed CEO
Following the £94.1m pre-tax loss recorded for the year to 31 December 2016, Interserve turned to Debbie White, CEO of services firm Sodexo’s global government and healthcare business.
14 September 2017 – EfW costs bigger than expected
In a trading update, Interserve confirms costs incurred from energy-from-waste projects will exceed the predicted £160m. The firm also confirms it expects annual performance to be “significantly below” previous expectations.
19 October 2017 - Interserve warns it may not meet financial covenants
Delays to completion dates on EfW plants cost Interserve a further £35m, while lenders HSBC and Royal Bank of Scotland hire EY to help tackle the firm’s problems.
Interserve also warns its second half operating profit will be around half of that recorded in the same period of 2016.
14 December 2017 - Interserve secures £180m three-month lifeline
Interserve manages to secure a £180m short-term finance, as well as a deferred test date for its loan covenants compliance for three months.
The sum is compiled from credit and bond facilities which will expire on 30 March 2018. Debbie White says the loans has put the company on “firmer footing.”
10 January 2018 – Debt to rise to £513m for 2017 and grow further
Debbie White Interserve 2
In a trading update, Interserve confirms net debt will hit £513m for 2017 and grow further in 2018, due to a “significant outflow” related to its EfW work and restructuring and refinancing.
The firm says its debt will peak in H1 2018 before starting to climb down in H2.
5 March 2018 – Emerald Investments buys up to a third of Interserve’s debt
Interserve’s Fit for Growth turnaround plans receive a boost as Emerald Investments buys up to a third of its debt, as the company scraps its ‘non-core’ power business and looks to cut up to 1,000 jobs.
21 March 2018 – Lenders give Interserve more time and fresh funds
Interserve secures an agreement with lenders to push its loan covenant test date to 30 April, and received cash lending facilities of £196.6m plus bonding facilities of up to £95m up until September 2021.
30 April 2018 – Firm reports £244m loss for 2017
Interserve posts a pre-tax loss of £244.4 for 2017, as net debt increased from £387.5m to £502.6m.
11 May 2018 – FCA launches investigation over EfW disclosure
Interserve is investigated by the Financial Conduct Authority over handing of inside information and market disclosure regarding its EfW business. The investigation covered the period 15th July 2015 until 20th February 2017.
7 August 2018 – £6m H1 pre-tax loss
Interserve posts a £6m pre-tax loss for the first half of the year, as overall group revenue dropped from £1.75bn to £1.53bn, while revenue for the UK construction business fell from £502.3m to £396m during the period.
14 June 2018 – Debbie White reveals ‘red rating’
CEO Debbie White reveals government has given Interserve a red rating as a strategic supplier, meaning it has “significant material concerns” about the company.
2 October 2018 – Scaffolding arm sold to reduce debt
Interserve sells its access and hard services arm for an initial £3.6m in a bid to reduce debt.
9 December 2018 – Interserve confirms debt-for-equity talks
interserve hoardings generic
Interserve confirms it is in debt-for-equity talks with lenders, which the firm claimed would deliver a strong balance sheet with the firm targeting leverage of approximately 1.5 x net debt / EBITDA.
Following the news, shares plummeted 75 per cent.
19 December 2018 – Two divisions merged as MD departs
Interserve merges its citizens services division with its support services unit. Yvonne Thomas, managing director of the citizens services division departs the business.
6 February 2019 – Provisional agreement on £480m debt-for-equity swap
Interserve provisionally agrees a deal with its lenders to swap £480m of its debt for new equity. The deal would give lenders control of 97.5 per cent of the company, based on the value of its issued shared. Lenders also agree to give the firm an additional £75m in borrowing to be paid back by 2022.
20 February 2019 – Coltrane buys further 10 per cent stake in Interserve
Coltrane Asset Management buys Goldman Sachs’ 10 per cent stake in Interserve, giving the company direct control of more than a quarter of the company’s shares.
Coltrane staunchly opposes the deleveraging plan tabled by Interserve and its lenders, which would virtually wipe out all shareholders and see lenders take control of 97.5 per cent of the company.
27 February 2019 – Interserve reports £111m pre-tax loss
Interserve reports a £111.3m loss due to a £5.9m operating loss and more significantly, £108.9m in interest payments to service its loans.
The company also reveals lenders have agreed to a £110m loan as part of its deleveraging plans, up from the £75m announced earlier in the month.
5 March 2019 – Board rejects rebel shareholder plan
Interserve refuses to halt its deleveraging plans and rejects an alternative plan from its largest shareholder, Coltrane Asset Management, which would see shareholders own 37.5 per cent of shares, leaving existing creditors in control of 55 per cent.
The asset manager also proposed a £110m rights issue, which it said it would underwrite.
10 March 2019 – Coltrane threatens lawsuits
Interserve’s largest shareholder Coltrane Asset Management threatens to sue the company’s executives over their handling of its refinancing. The fund tells Interserve’s directors it is prepared to take legal action over allegedly failing to disclose information, and for favouring lenders over shareholders.
12 March 2019 – Coltrane suggests it could buy Interserve out of insolvency
Reports suggest Coltrane has warned would-be administrator EU against a pre-pack sale of the firm to lenders, and demanded a full marketing process to find a buyer is carried in the event of Interserve’s collapse.
Specialist dispute firm Enyo Law suggests Coltrane could buy Interserve out of insolvency itself.
15 March 2019 – Interserve rescue plan voted down
Interserve worker van clipboard
Shareholders vote down the company’s deleveraging plans, setting the firm on a course towards administration
15 March 2019 – Interserve files for administration
Interserve announces it will file papers at the High Court for the parent company to be placed into administration.
Timeline: Interserve's path to administration