Materials firm withdraws from stock market pending outcome of urgent debt talks at all three divisions
Concrete group Ennstone has pulled its shares from the stock market pending clarification over its financial position.
The company is involved in crisis debt talks at its three divisions; the UK, US and Poland. They account for 40%, 40% and 20% of turnover, respectively.
In a statement to the City this morning, the £237m-turnover company said its US business would run out of bank credit at the end of this month.
The company’s overall debt is more than £200m.
It said: “In the US, the group's cash position remains critical and its US subsidiary, Ennstone, Inc, has suspended payments of interest charges and finance lease repayments to its US lenders. Discussions with those lenders are ongoing, and proposals have been made which may result in a solvent US solution, however the US lenders are still considering these proposals.”
It said lenders to its UK business had been supportive and a solvent solution was still being sought for that part of the business. It said it hoped for the same outcome for its Polish arm.
The company is under offer from Marwyn Materials and was also seeking fresh equity to bolster the balance sheet, but it indicated the chances of either deal happening were now slim.
The statement said: “Recent developments in these discussions, however, have meant that the likelihood of successfully concluding a solvent proposal for Ennstone and the group as a whole has now diminished greatly.”
A spokesman said: “With all these invariables it was decided the best solution was to suspend trading.”
The group may sell assets in an attempt to boost its balance sheet, including acquisitions and property.