INFRASTRUCTURE group Mouchel is expected to be acquired by its lenders – including RBS and Lloyds – in a pre-pack administration after shareholders yesterday failed to back a last-ditch restructuring.
Mouchel, which provides consulting and business services on road building and other public sector projects, had warned it would collapse unless investors agreed to give banks shares in return for wiping out a large chunk of its £140 million debt mountain.
But the proposals failed to garner the required 75 per cent support of shareholders, triggering alternative plans for administrators to sell its assets to affiliates of lenders RBS, Lloyds Banking Group and Barclays along with management.
Although shareholders will see their stakes wiped out, the deal will preserve the company’s 8,000 jobs and allow it to honour its contracts. Chief executive Grant Rumbles said he was “obviously disappointed” by the outcome after efforts to construct a deal which would have “delivered some value to shareholders”.
Mouchel has bases in Glasgow and Perth, from where its Scotland TranServ joint venture with Balfour Beatty manages the trunk road network in the north-west of Scotland.
Yesterday’s announcement marks the final chapter in a dramatic decline in value for the group, which last year turned down takeover offers from rivals Costain and Interserve for more than £150m, saying they significantly undervalued the company.
Before shares were suspended yesterday they were trading at less than 1p, compared with two years ago when they were worth 120p, and a high of 485p in 2008.
Mouchel’s woes were compounded last year when Richard Cuthbert resigned as chief executive after the company revealed a £4.3m accounting error.
