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Royal Imtech considers business sales to cut debts

Dutch group Royal Imtech said it would consider selling assets or parts of the business in order to reduce its debts and strengthen its balance sheet.

In a statement to the stock exchange, the group, which is the parent of Imtech UK, said: “Royal Imtech envisages to take decisions to pursue any such steps subject to further review.”

A review by the group’s auditor KPMG will be published on 27 August alongside its results of the six months to 30 June 2013.

The group said there were “significant losses” in its German and Eastern European, Marine and Benelux divisions in the second quarter of 2013. It said the losses were project rather than cash losses.

It said that “cost levels remain too high” in those areas.

But it added that other divisions of Royal Imtech “continue to perform at satisfactory levels”.

The contractor, which announced a £434m rights issue following expected losses on Polish projects of £130m and £130m of write-offs on German projects, said dealing in its shares would be suspended from 13.00 (central European time) on 25 July in preparation for settlement of its rights issue on 31 July.

It said banks Rabobank and ING would place cumulative financing preference shares to raising £25.9m. Major shareholder ING AM Insurance has agreed to buy shares to maintain its stake in Royal Imtech at 5.72 per cent.

In the statement, the group reiterated that there would be job losses in Germany (550 jobs), Benelux (550 jobs) and its Marine business (140 jobs).

Of its £69m total cost, £36.2m of the job loss programme would be included in the accounts for the first six months of 2013.

It added that £8.6m of its total £56m restructuring costs would also be recognised in the accounts for first half of this year.

It said Imtech Benelux was affected by volume and price pressure in the commercial real estate and infrastructure markets and would also recognise valuation allowances and expected project losses of approximately £12.9m in total for the second quarter of 2013.

The firm also said Imtech Marine was hit by lower volumes and the high costs and would also have valuation allowances and expected project losses of approximately £21.6m.

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