Housebuilder is seeking cash injection to prevent breach of bank convenants according to reports
Troubled housebuilder Crest Nicholson is considering asking shareholders, including banking group HBOS, for a cash boost to prevent it breaching bank covenants.
Sources close to the company said it is in talks with its investors about the provision of additional equity, according to The Times. It is understood the group will have to inject around £100m into the housebuilder.
It is also thought HBOS, which owns 50% of the company, is considering asking a new partner to buy into the company to provide the much-needed funds.
Crest Nicholson was bought in 2007 by Uberior Investments, the private-equity arm of HBOS, and West Coast Capital. It has since been hit hard by the downturn in the housing market.
In June, it reported profits of £69.7m, down £80m on the previous year. The firm has appointed Deloitte to advise it on its financial problems.