Infrastructure maintenance group agrees to review as part of £180m debt refinancing process
Mouchel has confirmed that its banks have hired accountancy and restructuring firm Deloitte to carry out a targeted review of the business.
The infrastructure maintenance group is in talks to refinance its £180m credit facilities with its lenders, which include Royal Bank of Scotland (RBS), Barclays and Lloyds.
Deloitte will carry out the review ahead of the refinancing, which was announced on 14 October. According to the Telegraph, the review will focus on how the drop in the company’s public work will affect future cash flow.
The move by the lending consortium follows after a series of profit warnings from Mouchel, which also recently scrapped the final dividend payout to save £4m cash, sending the share price tumbling.
Mouchel’s latest statement confirms that Deloitte has been appointed to undertake a “limited scope review” with the agreement of the company, and refers to “press speculation regarding its ongoing discussions in respect of the refinancing of its debt facilities”.
The group also restated that it expects the refinancing to be complete by the time of its interim results in March 2011, and said its banks remain supportive.