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Employees reassured ahead of Interserve administration

15 March 2019

As its board of directors applied to the High Court for Interserve to be placed into administration, the company urged its employees to continue working as normal.

Using its official Twitter account in a message to employees, the company said: "We want to reassure you that it's business as usual.

"Turn up for work as normal, you'll be paid as usual," the company stated and included a hotline number for employees, customers and suppliers.

The company has also issued a statement claiming that placing it into administration will allow it to be sold to a new company controlled by its existing lenders.

This will allow it to "restore the group's balance sheet" and ensure its subsidiaries remain solvent and provide continuity for customers and suppliers, it said.

It is expected the move will release £815m of secured debt and "approximately £202m of contingent secured liabilities owed to the group's bonding providers".

Approximately £485m of existing debt will additionally be exchanged for shares in the new company, along with the provision of £110m of additional liquidity.

While the new company owner will "assume approximately £3.42m of the company's intragroup payables liabilities", the new arrangement is not expected to see Interserve shareholders retain any value.

The statement concluded that the board believes the solution "is the best remaining option to preserve value, protect the jobs of employees and ensure the group can carry on as normal with minimal disruption".

Further details of the application and new ownership are expected to be announced later today.

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