Interserve Share Discussion Threads

[cc2014] 20/12/2018 15:47

That's a really good point Pundit.

[pundit1] 20/12/2018 15:43

Cc2014- With construction what if a Parent Company Guarantee exists on some of these contracts.

[cc2014] 20/12/2018 15:16

There's no way the lenders have agreed to put an extra £75m without conditions. last time they took 20% of the share capital. They are going to want something in return...

And I think the likelyhood of someone having that sort of insider information and being stupid enough to publish it is fairly low.

[billtucker] 20/12/2018 15:01

Fenners- agree that if it’s on top of the the reported 625m, then they are just adding fuel to the fire. However makes you wonder why lenders would inject more in if they are already planning on taking an alleged haircut. This division should have been closed down a long time ago, there is simply no money in that business anymore.

[cobbles1] 20/12/2018 14:56

So it's not a cash injection as such but a debt injection... Meanwhile the purse strings are unseasonably tight elsewhere

[fenners66] 20/12/2018 14:53

If so that's likely to be north of another £625k a month in interest and net borrowing rises ?

Would it increase the year end figure to nearer £700m?

Whilst it is clearly good news for employees - I cannot see it being good for shareholders.

Again I did not see them going bust - just draining the equity from shareholders and that news would seem to add pressure.

[billtucker] 20/12/2018 14:43

Fate- Apologies my post wasn’t clear. Someone on LSE has just reported the lenders and IRV board have just approved a 75m cash injection into the construction division. Can’t find anything myself, but if true could be good news

[fenners66] 20/12/2018 14:35

Bill - sorry don't understand your post ...

"Yvonne Thomas, managing director of Citizen Services, will be leaving the company at the end of December to set up a new venture."

With what pay off ?

Does she leave with the annual bonus as well ?

After all that would set a precedent .....

One could speculate she is getting out whilst she can still get paid off.
Then if she puts the cash to a competitive venture ... ?
I know, the deal should be worded so that she cannot compete , but what is she leaving to do ?

If it is to compete how weak a position is IRV in ?

All speculation of course

[billtucker] 20/12/2018 14:15

Well someone has just advised on led construction had another 75m capital injection so.

[cc2014] 20/12/2018 13:03

ok, so by extension. In your scenario the company goes bust as it runs out of cash as suppliers continue to demand earlier payment terms. The banks get nothing

So, more likely the debt gets written down to say £200m in exchange for some warrants, or convertible pref shares with a low coupon or whatever. The assets are then worth more than the liabilities and the EBITDA is enough to cover the interest payments even at 10% interest rate.

Then investors will see a possible return (subject to more certainty over resolution of EfW, other problem jobs, Viridor and the FCA).



The issue remains though that whatever the bondholders do about the debt, IRV still needs more cash as it's crisis of confidence which is growing every day.


Now, if the bondholders are absolutely ruthless, they could do the following. Swap some or all of the debt for 99.5% of the share capital, put construction into formal liquidation to rid itself of the liabilities of EfW and all the problem jobs and they are left with a healthy and profitable support and equipment services.
Legally not so difficult but how would the government react?

[eodfire] 20/12/2018 12:52

All in your opinion I hasten to add. You aren't making a factual comment.

[cc2014] 20/12/2018 12:17

Ok, rights issue thoughts.

£150m rights issue at 1p = 10 shares for every one currently held and shareholders asked to put in 10 times their current holding.
i.e. if you own £5k worth of shares, the rights issue will be for £50k worth. PI's simply won't have the money and even funds will baulk at that.

So, it would have to be underwritten but given that most PI's will be selling their rights due to 10 for 1 situation who is going to underwrite it? I'd say no-one.

So, therefore by my logic any capital raise will have to be something more exotic. I'll leave the experts to figure that one.

EfW still not handed over...

[losses] 20/12/2018 11:45

5-6p coming soon

[eodfire] 20/12/2018 11:11

Fair bit of buying around the 10p level.

[billtucker] 20/12/2018 10:28

Square points have opened another short here 2 days ago which will explain the drop in so. Not sure if they are expecting it to go to o, or just a make a killing from the fluctuation.

[fenners66] 20/12/2018 09:20

"Two materials firms have admitted breaking competition laws by taking part in a cartel.

The Competition and Markets Authority discovered that price fixing meetings went on for seven years from 2006 in the pre-cast concrete drainage sector."

Fines to be decided.

So from 2006 to 2013

I have said before that the construction sector as a whole was facing much more stringent scrutiny on contract pricing after government focus 5 years ago.

The govt. believe the measures they have taken have removed price fixing practices - this is related and shows that they are having some effect.
I said I expected margins to fall on the back of tender rules - seems that has been the case as well.

[fenners66] 20/12/2018 08:58

You cannot see underwriters queuing up to support a rights issue here now.

It does highlight the management failings at IRV.

We have known for at least a year that fund raising was necessary and so must the management - but instead of doing something about it , they have prevaricated until the market in general and more specifically the construction sector has turned against them.

Now beaten to the punch again by Kier, following Capita's issue - where do IRV go ?

Must be time for an annual directors 125% bonus, after all they are still in their jobs....

[ebomber] 20/12/2018 08:32

Underwriters hit as Kier £250m rights issue flops
Aaron Morby
29 mins ago


Bank underwriters are facing heavy losses on Kier group’s £250m rights issue after just over a third of shares were taken up.



This is not good for the sector and specifically IRV.

[cc2014] 20/12/2018 08:19

I assume the share price fell yesterday on the back of this:



Chances of IRV getting a rights issue away in this climate? small?

[fenners66] 19/12/2018 23:06

So you have not read the thread before then sbs - do some research...

[sbs] 19/12/2018 22:48

Maybe not mentioned because we don't know how much they are, whether a new hedge was taken out etc.