You privatise the National Forensic Science Service and just look what happens. This from BBC website:-
Randox forensics inquiry: Forty drug-driving offences quashed
At least 40 motorists convicted of drug-driving offences have been cleared after evidence of manipulation was found in the forensic testing process. The motorists were banned from driving and in some cases fined, but their convictions have since been overturned. About 10,500 test results are being reviewed after data was allegedly manipulated at Randox Testing Services.
The National Police Chiefs' Council (NPCC) described it as a "most serious breach" of forensic science standards. A further 50 drug-driving cases have been dropped as a result of the alleged data manipulation at the firm's Manchester laboratory. Police suspended all contracts with the company, used by 42 of the UK's 43 forces, in November last year.
Greater Manchester Police has arrested two men, aged 47 and 31, who worked at one of its laboratories. They were arrested on suspicion of perverting the course of justice. Six others have been interviewed under caution, with one remaining under investigation as part of what Justice Minister, Lucy Frazier, described last month as an "expansive" criminal inquiry.
Analysis
The scale of the operation to review the 10,500 Randox cases is unprecedented. It began in January 2017 and is likely to continue until the end of 2019. Randox, which is paying for samples to be re-tested by other laboratories, estimates it will cost the firm £2.5m. Police are also likely to incur costs because of delays to other cases, while motorists whose careers and livelihoods have been affected after being wrongly banned from driving may sue for compensation.
But the most significant impact of this disturbing affair may be on public confidence in forensic science: can we be sure that the test results we almost take for granted are accurate? In total, up to 2,700 cases have been re-analysed so far and two drug-driving cases that resulted in road deaths were referred to the Court of Appeal. Both convictions were upheld but one motorist's sentence was reduced. Two other non-fatal cases involving drug-driving have also been sent to the Court of Appeal. One conviction was quashed and the other has yet to be decided.
Ch Con James Vaughan, NPCC lead on forensics, said he could not remember a forensic science failure "of this magnitude". He said re-testing was taking longer than expected because there was a "chronic shortage" of scientific expertise and accredited laboratories, leading to delays in providing toxicology analysis in unrelated cases of sexual offence and rape.
Might number 3 be about the Court Interpeters how is that working out?
ReplyDeletehttps://onesmallwindow.wordpress.com/2018/07/09/a-breakdown-in-communication-court-interpreting-privatisation/
Another national disgrace
ReplyDeleteFrom the Independent May 2018
ReplyDeleteHome Office squanders £229m in 'incompetent' outsourcing of criminal record checks upgrade
A £656m government scheme to upgrade the UK’s criminal records checks system has been branded a “masterclass in incompetence” in a damning Commons report.
The Home Office project to modernise the Disclosure and Barring Service (DBS) has been marred by poor planning, delays and spiralling costs after it was outsourced to a private consultancy, said the Public Accounts Committee.
The programme is more than four years late and costs are expect overshoot its budget by £229m, the report added.
“Government has a crucial role to play in safeguarding children and vulnerable adults but the handling of this project has been a masterclass in incompetence,” said PAC chairwoman Meg Hillier. “None of the cost-saving and service benefits set out in the original business case have been achieved.”
In 2012, the government contracted Tata Consultancy Services to design, build and run a new IT system that would modernise DBS and move its services away from a paper-based system.
The project was expected to be completed by June 2014 but it was delayed from the start and the DBS was forced to extend a contact with its previous contactor, Capita, by two years.
The modernisation is still not complete, while the expected total cost has soared from £656m to £885m.
It is not clear when Tata now expects to complete the project and the PAC said there was “a strong risk that they may run out of time before the contract ends in March 2019”.
A new feature introduced to make it easier to check for updates to records has received only a “fraction” of the demand expected due to “a failure to understand what service users want”, added the report.
It said the project “has not delivered the promise of a cheaper, better safeguarding service for customers”.
It added: “Negotiations affecting the future of DBS are under way and government must monitor these carefully,” said Ms Hillier. “It then needs to be straight with Parliament and the public about what, if any, benefits it expects to materialise by the time DBS’s contract with Tata Consultancy Service ends.”
Four million disclosures were issued by DBS in 2016/17, of which 260,000, or 6.1 per cent, contained information that was “potentially relevant to safeguarding”, according to figures published by Whitehall’s spending watchdog earlier this year.
The PAC said it also had “serious concerns” about the implementation of the Emergency Services Network (ESN), the new communication system that will be used by the UK’s police, paramedics services and fire crews.
The £1.2 billion system, which has been contracted to EE, is scheduled to launch next year but in February the committee criticised progress as “deeply unsatisfactory”.
Ms Hillier said: “These are testing times for the Home Office. The department also faces huge challenges arising from the UK’s departure from the EU – not least, potential threats to security at the border from day one of Brexit.
“On both DBS and ESN the Home Office appears either to have ignored or not fully understood the needs of the end user. It does not fill us with confidence that all is rosy on the department’s other major projects. Although we received verbal assurances that they are running smoothly, these are not enough.
“We expect the Home Office to demonstrate that, when things go wrong, it has learned from and is acting on the lessons.”
http://www.pulsetoday.co.uk/clinical/clinical-specialties/cancer/capita-waited-months-to-tell-nhs-england-about-cervical-screening-letter-issues/20037792.article
DeleteThere must be some means of attaching responsibility for these massively expensive fuck ups to an individual or series of individuals?
ReplyDeleteTR - Pantomime Dame Brennan, Romeo & Grayling
Interpreters - Brennan
DBS - ?
Digital Courts - ?
Forensics - ?
Its time to name, shame & send the bastards an invoice. Strip them of their 'honours' & claim back their salaries, perks, expenses, etc.
4 April 2013 - https://www.civilserviceworld.com/interview-ursula-brennan
ReplyDeleteGUILTY!!
"Brennan did not stay at the MoD to see the change programme through: in October 2011 defence secretary Liam Fox resigned over the Adam Werrity affair – and eight months later she also left, moving sideways to the Ministry of Justice. The government’s lead non-executive director, Lord Browne, has since revealed that some MoJ non-execs were irritated by Brennan’s appointment. Because it was a ‘managed move’ rather than the result of an open recruitment process, she explains"
"The National Audit Office, the Justice Select Committee, and the Public Accounts Committee have all published highly critical reports on the interpreters scheme, with the Justice Committee chair Alan Beith condemning it as “shambolic” (see CSW 20 February). Here, Brennan is uncomfortable again: “It’s a really good example of how difficult it is to get across the story about something that isn’t necessarily straightforward,” she says, with an awkward laugh... “That contract is an example of something that had an unhappy introduction, but has stabilised into a much better place. It has saved us money and introduced quality standards – but somehow it’s been difficult for us to get that message across.”
“we took a very clear view that said: if you’ve got a group of people who are not going to make as much money out of the new system, delaying it creates an opportunity for further confusion and the belief that we weren’t determined”. She argues that “the most important thing was to demonstrate that we were going to get on and do this. We took the judgement that we were better to crack on and do it than to have a haemorraghing of interpreters who’d think that if they held out, we’d change our minds.”
But surely that single-minded concentration on pace left little room for trials, pilots, or development of the market so that the MoJ could choose from a range of providers? At this point the press officer interjects to suggest that we move onto a different topic...
On probation
At the beginning of this year, the MoJ set out plans to restrict the probation service’s role to writing court reports, overseeing risk management, and handling high-risk offenders: other offenders will in future be handled by contractors, it said, while support services will be extended to the short-sentence prisoners currently released without a probation referral. Asked what the department will be focusing on as it develops these plans, Brennan explains that it’s working hard to identify both effective ways of working with offenders, and robust models for the delivery of PBR services.
Brennan again, Dec 2014, Law Gazette -
ReplyDeletehttps://www.lawgazette.co.uk/law/moj-chief-admits-cuts-rushed-through-without-research/5045500.article
Leading civil servants at the Ministry of Justice have admitted they did not have the time to research the potential impact of cuts to civil legal aid.
During a lively session before the House of Commons public accounts committee (PAC) this morning, MoJ permanent secretary Ursula Brennan (pictured) said the government’s decision to cut £300m from the legal aid budget was ‘imperative’.
When pressed by committee members to explain the evidence basis for the subsequent Legal Aid, Sentencing and Punishment of Offenders Act which came into force in April 2013, Brennan said the timescale did not allow for evidence-gathering in advance.
‘The government was explicit it needed to make these changes swiftly,’ she told MPs. ‘It was not possible to do research about the current regime.
‘The piece of evidence that was overwhelming was the level of spending. The evidence required was that government said we wish to cut the legal aid bill.’
Brennan said research on the impact of LASPO had to wait until after the legislation was implemented but she rebutted the opinion that the measure had denied people access to justice.
The permanent secretary also conceded that she does not know the cost of the reforms for other government departments, such as health, as no research has been carried out.
Still, its all downhill now for the luckless Dame:
ReplyDeletehttps://www.civilserviceworld.com/articles/interview/dame-ursula-brennan-former-ministry-justice-permanent-secretary-why-she-left-moj
The former permanent secretary of the Ministry of Justice – and before that the Ministry of Defence – looks back on her Whitehall career over lunch with CSW editor Jess Bowie
Who? Dame Ursula Brennan joined the civil service as a fast streamer in 1975. She held a number of high-profile roles in Whitehall, including as the Ministry of Defence’s first female permanent secretary. She became perm sec of the Ministry of Justice in July 2012 and retired from the civil service in July 2015. She currently sits on the board of the National Theatre and on the council of her alma mater, the University of Kent.
The restaurant Bank Westminster: Seasonal food served in the pleasant surroundings of a huge conservatory overlooking a courtyard. Less than five minutes’ walk from St James’s Park tube.
The menu – Starter: Bread basket | Main: Arctic salmon with roast pumpkin; butternut squash and goat’s cheese tart | Drinks: Tap water; single espresso; white coffee
How do they cope?
More to the point, how do they sleep at night!?
There's no austerity to be found I the private sector. Public funds to them is just free money.
ReplyDeleteLast week the CEO of Persimmon, a house building company was forced to cut his bonus award after much criticism. His bonus was cut from £100m to just £75m.
Today the CEO of the company that provides mobility aids to the disabled is under fire for receiving an almost £2m bonus on top of his £1.7m yearly salary.
Yesterday I read that Gauke is praising the number of companies that have signed up to his scheme to get exoffenders into employment. However, it's not Mr Timpson that is quoted, rather its the CEO of Amey. What could go wrong?
https://www.gov.uk/government/news/drive-to-employ-ex-offenders-attracts-over-120-businesses
I get pretty pissed at things like this as the only beneficiaries are the companies that can access shite loads of money for training and employing exoffenders on a short tempory basis with no regard for what happens to them when the money runs out and they're cut loose.
Probation used to do much to assist offenders into employment, and I take the view that the cost of such initives should really be calculated within the cost of privatised probation and not as something separate.
The monetary cost of privatisation and outsourcing is astronomical, and the social and human cost is devastating.
A £75m bonus? Come on!
'Getafix
FT today:-
ReplyDeleteInterserve, one of the biggest outsourcing companies serving the UK government, is in rescue refinancing talks that could see creditors take control as it seeks to avoid a Carillion-style collapse.
The company, which employs 45,000 people in the UK in key services such as schools and hospitals, is seeking to restructure its finances for the second time this year, in the latest sign that the crisis in the UK outsourcing sector is deepening.
Under the terms of the proposed deal, banks and other debt holders would take a significant loss on their existing exposure as part of a debt-for-equity swap, while public shareholders would be virtually wiped out, according to people close to the negotiations.
24.50 GBX +0.50 (2.08%)
Delete7 Dec, 16:35 GMT
Closed up (UP!?!) at 24.5p on Friday
It was 708.5p in Mar 2014;
It was 628.5p when it took the reins of the CRCs;
Debbie joined Interserve as Chief Executive Officer in September 2017 - sp = 169.25p on 1 Sept 2017, 81.5p on 15 Sept 2017...
... and its been downhill ever since!
BBC February this year.
ReplyDeleteIf I described a company that had issued a big profit warning, watched its shares fall by nearly 80% in 18 months, been handed several big public sector contracts, seen work in the Middle East cancelled, witnessed a big rise in its debt pile, recently changed chief executive and finance director and had had its trade credit insurance withdrawn - you might think I am talking about the Carillion of a few months ago.
I am, in fact, describing a company called Interserve which, despite some important differences, is the company that bears the closest resemblance to the liquidated Carillion.
Interserve won contracts last year with the Ministry of Defence, the Ministry of Justice, Network Rail and the State of Qatar.
Despite a new £102m contract in the Gulf state, its most recent financial report in July last year admits that "political developments in the region remain a clear risk to the business that could impact during the second half of the year and beyond".
In its UK construction business, Interserve has been losing money and been exiting contracts where it can.
On almost unchanged revenues, its operating profits fell 28% in the six months to July 2017 while the more important cash flow turned negative.
Meanwhile, its debt pile rose 41% to £387m as of July 2017 and is thought to be around £500m now.
After its profit warning in September, the new management conceded that it was possible it would not be able to honour the promises it had made to its banks, and in October its trade credit insurance was withdrawn - just as happened to Carillion nine months ago.
Similar, but different?
To be clear, there are some important differences.
The company cancelled the dividend nearly a year ago to preserve cash and its lenders recently advanced some short-term financing - a sign perhaps they believe the new management can turn things around.
The new chief executive, Debbie White, has already embarked on a turnaround plan that has included cutting both costs and headcount, which could boost profits by £15m this year.
Its debt compared to its net worth is high, but not nearly as high as Carillion's, and it has assets like plant and machinery and interests in joint ventures it could sell to raise cash - a luxury Carillion didn't have.
Carillion had a number of major projects that went sour whereas Interserve's problems stem primarily from one line of business - its energy-from-waste business - from which it is extricating itself.
The UK government says it is monitoring Interserve and in a recent statement declared "it doesn't believe any of its key suppliers are in a similar position to Carillion".
Interserve is a much smaller business than Carillion, but if you were looking for a mini-me this looks like a chip off the old block.
The predators in the financial markets who bet against companies - as they did so heavily with Carillion - are sniffing around Interserve.
A 14% intraday share fall in January didn't last long - the shares that day recovered most of their ground. Since then, however, the shares have gone below the trough hit that day and fell almost 20% on Thursday.
Capita 'not comparable' to Carillion
Where did it all go wrong for Carillion?
Like Capita, it needs to raise more capital by issuing new shares.
Unlike Capita, (which announced plans on Wednesday to raise £700m of new equity) it hasn't managed to do it yet.
As a major fund manager told the BBC: "There has been radio silence on that for some time which suggests they are not finding it easy. The outsourcing sector is going through a denouement - Interserve has been playing the same game (as Carillion) and that game is over."
The company announces full year results at the end of March.
It will feel like a long wait for holders of the shares and will feel like a lifetime of work for Ms White, who will have to reassure and convince the banks to stick with the company before she can reassure the markets.
Since February, Interserve have sold off its plant and machinery assets, aswell of what it could of its construction arm of business.
DeleteIts primary income now comes from government contracts, and has no real assets of its own except its share value, which of right now, you can get four for quid!
I thought that no one delivered public services better than the outsourcing companies:public - bad, private - good. But this little mantra would seem to based on delusions, if not lies. They sound more like get rich pyramid schemes - the directors, etc, pay themselves big wages and bonuses, the workers get screwed and the taxpayer carries all the risks.
ReplyDeleteI work for Interserve justice, it is in crisis. 3 weeks ago all staff asked to rank job preference ie, community, resettlement, low risk band one, interventions and I've forgotten the other one, last week we were notified of the outcome. Many folk unhappy 29% didn't get their first preference and not only that all teams are being mixed up and why jumble everything up again, new teams are to be in place by January. Just before Christmas as Well. No word from union reps, it's just a horrible place to be at the moment. No-one can understand why this has come about all of a sudden, it's so rushed.
ReplyDeleteWhen Interserve Justice, sorry, I mean 'Purple Futures' (remember that?) rush in yet another new unexplained, unjustified, untried, unfinished, half-baked operational model you can be sure that the sole reason is MONEY. Money is not for spending on staff, or service provision. It's not for spending in serving justice, or protecting the public, and it's certainly not for helping those on probation to change their lives. No. The Money is not even for the CRCs - the Money is for Interserve. Nothing else matters.
DeleteI know for sure thst there are probation officers in Interserve that have had NO laptop access for over two months, new ones ordered but when arrived where also broken, also some of those staff work part of the week in satelitte offices seeing service users with no access to delius so can't check enforcement or conduct referrals ? it's carnage.
DeleteI too work for Interserve within CGM ,I cannot blame Interserve for the current carnage , I never had any faith in a private company successfully carrying out the work we had actually done quite well, my disgust and disappointment lies with those that were Probation staff ( Probation officer trained ) who have sold their personal and professional integrity for ££££'s - the models that they continue to drag out ( as discussed above in other post ) are soul destroying and oppressive for both staff and service users.
DeleteI'm a strong stoic person but interserve are literally playing 52 card pickup with service users and staff, Interserve aren't having service users as number one priority if their case managers have no regular IT equipment, because of persistent weekly targets when access to an office computer happens prioritization is making sure enforcement and unpaid work is done then breaches etc. Many a time a referral gets done weeks after the original promise to do one.
DeleteSo, if currently you have a caseload of 70 community cases and you got your first preference of Resettlement then your entire caseload gets reallocated?? 70 service users then having to have a new manager with all the upheaval that brings? Someone needs to do a FOI to find out how many entire caseloads are going to be effected because it sounds ludicrous and, at a push should be phased in rather than having a 'big bang.
DeleteIt is a ludicrous idea one that it appears staff have been given as usual half arsed information to base their choices on and yes we've been told this all had to be in place by January with no thought to service users who may well end up starting all over again with a new officer - no thought or care to relationships and good work that may have been completed - anyone within Interserve have any ideas why this model is now being introduced ?? it's got to be about fire fighting ( lack of PO's , lots of inexperienced staff etc ) I can't see it coming from a good place to be beneficial to service users or staff.
DeleteIt's an attempt to camouflage the fact that they're offloading qualified, experienced, expensive staff to the NPS to save money by pretending the work can all be carried out be inexperienced , untrained, unqualified new starters. Never mind public safety, staff safety and providing an adequate service , Interserve wants to keep the money, thank you very much!
Deletehttps://www.bbc.co.uk/news/uk-46494465
ReplyDeleteTelegraph - paywall
ReplyDeleteInterserve's largest lenders, including two hedge funds, are plotting to wrest control of the troubled outsourcer in a debt for equity deal that would see long-suffering shareholders wiped out.
The Sunday Telegraph understands that Interserve’s lenders have lost faith in the troubled company’s management since its first round of rescue talks earlier this year.
Banks including RBS, HSBC and BNP Paribas, together with Emerald Asset Management and Davidson Kempner Capital, will attempt to force a fresh debt deal on the company that would hand control to the lender group.
Reuters:
DeleteThe company, which amongst other activities cleans rail stations and provides probation services to the Ministry of Justice, said on Saturday [8/12/18] that it was on track to report growth in operating profit in 2018 and that its board was focused on finding the right financial structure for the company.
“This includes options to bring new capital into the business and progressing the disposal of non-core businesses,” it said, without giving further details.
And thus, whilst the shareholders lose £billions, Interserve still say they are "on track to report growth in operating profit in 2018". The delusional belief system inherent in capitalism is astonishing. If they weren't global business leaders they'd be assessed as unwell & in need of medication.
Interesting conversations by those that hold shares in Interserve can be found here.
ReplyDeletehttp://www.lse.co.uk/ShareChat.asp?ShareTicker=IRV
Maybe a heads up to be found as the saga unfolds?
From ThirdForceNews, Oct 2017
ReplyDeletehttp://thirdforcenews.org.uk/tfn-news/new-work-programme-set-to-be-dominated-by-large-employability-organisations
- Start Scotland Ltd was founded in March of last year, and previously known as Randotte WLS Ltd.
The group won contracts in the East (£21.3m) and Southwest (£10.1m) regions. It is described as a private and third sector partnership, however three of the four listed board members also serve as directors of Working Links, one of the main providers of the Work Programme initiative.
Joanna Laxton (secretary), Brian Bell and Stephen Moon are all named on Companies House as directors for Working Links (Employment Ltd). The sole member of the board who is not a Working Links representative is Blyth Deans – chief executive of The Lennox Partnership – who joined the Start Scotland board on 30 August.
Last year, the company was acquired by Aurelius Investments, a European investment group which has its headquarters near Munich and posted annual consolidated revenues of €3 billion for 2016.
After acquiring several companies last year - including Working Links - Aurelius said it was hopeful of further profit. A statement said: “We expect further growth for 2017 as a result of the acquisition of interesting and promising companies that will further strengthen our portfolio.
“We will continue to hold ourselves to our strict investment criteria in future acquisitions, and as they arise will take advantage of opportunities with manageable investment totals and high growth potential to generate profits.”
In response, the Scottish Government said that Start Scotland is a joint venture between Working Links and The Lennox Partnership, with the contract issued to Start Scotland as the legal entity of the organisation.
A German [i.e. Aurelius] view from July 2016 on the Aurelius move (translated Deutsch to English):
ReplyDeleteMunich / London - AURELIUS Equity Opportunities SE & Co. KGaA (ISIN: DE000A0JK2A8), a European investor with a focus on corporate spin-offs and companies with potential for improvement, has Working Links (Employment) Ltd. ("Working Links") acquired by the sellers UK Government Investments, Capgemini, Manpower and Mission Australia. Silence has been agreed on the purchase price.
Working Links has offices in the United Kingdom, Ireland and the Middle East and provides counseling and support services for reintegration and rehabilitation in three different areas: The field of occupational reintegration aims to improve people's living conditions through employment, training and personal skills development improve. The social reintegration measures for relapse prevention are intended to prevent re-offending and protect the public. The international services sector includes vocational rehabilitation advisory services for domestic workers in Saudi Arabia and Kuwait and the implementation of "Job Path", an Irish government program to bring long-term unemployed people back to work in six regions of Ireland.
Since its inception in 2000, Working Links has delivered more than 200 government contracts and programs, helping more than 350,000 people return to work and social care. In financial year 2015, the company generated sales of around 160 million euros with positive EBITDA.
The acquisition by AURELIUS enables Working Links to swiftly implement the transformation that has already begun with the support of our task force, to successfully implement the new IT system with the help of our portfolio company Getronics and to identify cooperation potential with our portfolio company Allied Healthcare, which also provides social services in the public sector he brings.
Against the background of Brexit, this investment proves once again that AURELIUS is more counter-cyclical and that macroeconomic upheavals provide interesting opportunities for our business model.
Extract from Working Links 'Tax Strategy' briefing:
ReplyDelete"Working Links (Employment) Limited’s parent company and ultimate controlling party is Aurelius AG, a company incorporated in Germany with offices in Munich and London and subsidiaries in Germany, United Kingdom, Switzerland, Norway, Belgium, Luxembourg, Slovakia and Slovenia, as well as the United States, China, Malaysia, India, Thailand and South Korea. The shares of Aurelius AG are traded in the m:access of the Munich Stock Exchange under ISN DE000A0JKA8.
Copies of the Aurelius AG consolidated financial statements are available on their website or via the Investor Relations and Corporate Communications team which can be contacted via [phone, email, etc]
Our tax strategy reflects our status as part of Aurelius AG which requires strong governance and consideration of our reputation, while delivering returns to our shareholders.
How the UK Group manages its tax risks
The UK Group’s ongoing approach to UK tax risk management and governance is based on the principles of reasonable care and materiality. The UK Group maintains ongoing application of tax governance with strong internal controls in order to substantially reduce tax risk to materially acceptable levels. As part of this governance, the UK Group has identified tax risks, which are maintained on risk registers, and their materiality is assessed based on a corporate risk matrix which records the potential impact on the Group if the tax risk crystallises and the relative likelihood of it crystallising."
Working links skills ltd is a new summer start company. Same old working links dysfunctional group needing a bolt hole as Aurelius are draining every penny out. Staff and service provision casualties of greed.
DeleteTraders re-Interserve this morning: "There could well be some good trading opportunities here"
ReplyDelete"Trading Places"
Delete"excited for my £500 buy at 8p lol"
"money to be made, get in quick boys n girls"
"Now filling up level 2. Short term this is a good trade could well double your money. Timing is critical"
"20% profits and i am out , thanks IRV."
Jobs, savings, pensions, livelihoods - they mean nothing.
Really? 11p a share?
Deletehttps://www-bbc-co-uk.cdn.ampproject.org/v/s/www.bbc.co.uk/news/amp/business-46505688?amp_js_v=a2&_gsa=1&usqp=mq331AQHCAFYAYABAQ%3D%3D#aoh=15444353449503&_ct=1544435352709&referrer=https%3A%2F%2Fwww.google.com&_tf=From%20%251%24s
ReplyDeleteCreditors to the troubled outsourcer have hired Lazard to advise on the terms of a £600m rescue deal, Sky News learns.
ReplyDeleteLenders to the troubled outsourcing group Interserve have drafted in bankers to stitch together a make-or-break restructuring that is likely to see them take control of the company.
Sky News has learnt that Interserve's creditors have appointed Lazard to help thrash out the details of a debt-for-equity swap and share issue that have become necessary to salvage its future.
Interserve, which employs roughly 45,000 people across the UK and is one of the government's biggest private sector contractors, saw its shares plunge by more than half on Monday after warning that investors were likely to see "material dilution" from its debt reduction efforts.
Sources said that Lazard would join EY, the accountancy firm, as an adviser to Interserve's lenders - reuniting the team which worked for the board of Carillion prior to its collapse in January.
The company is understood to be drawing up plans to convert more than half of its debt-pile to equity, with investment banks including JPMorgan, Numis and Peel Hunt expected to be engaged to assist with a further equity fundraising.
Interserve, which works on major construction and renovation projects, is one of the UK's biggest private sector employers, providing support to Britain's armed forces in Cyprus, Gibraltar and the Falkland Islands.
The crisis surrounding its finances has persisted for more than a year, initially blaming economic uncertainty and weak government spending for a massive profit warning in the autumn of 2017.
Led by chief executive Debbie White, Interserve said in a statement to the stock market that the company and its lenders "are engaged in constructive discussions regarding the agreement and implementation of a deleveraging plan which would deliver a strong balance sheet".
The company is the latest in a string of UK outsourcers to face material uncertainty over its finances, with Carillion's insolvency coming in the wake of rescue efforts at Capita and Serco.
In recent weeks, Kier Group, another major industry player, has announced plans to raise more than £250m by selling new shares - a move which has caused its own share price to plummet.
What is NAPO saying?
ReplyDeleteThe potential demise of Interserve must warrant some comment?
erm, nothing - as usual.
DeleteYou would think a lobby letter to all seeking staff reassurances on protections. CRC custody to NPS pro temp and all arrangements to be agreed . No idea deficent leadership.
DeleteTheresa May just announced that she is deferring her leaving do. Interserv have similarly deferred their leaving do too. What bizarre times. What could possibly go wrong? Who will survive amongst these deal makers? What consequence?
ReplyDeleteInterserve sp has flatlined at about 12p for most if the day, having dived down to almost 6p on opening.
ReplyDeleteMaybot has gone haywire.
Extraordinary times!
ReplyDeleteAye, for all the wrong reasons!!!
DeleteI find it astonishing that with Interserve on the brink of possible collapse, and with no real recoverable assets, they are still being awarded multi million pound contracts.
Deletehttps://www.insidermedia.com/insider/wales/interserve-wins-25m-hospital-contract
'Getafix
It is an utterly bonkers scenario but there's an explanation here from a trader which, if I understand it correctly, means that the creditors (mainly large financial institutions who loaned to Interserve) have taken control & implemented a Debt for Equity (DfE) deal, taking new shares in lieu of cash owed. This massively inflates the number of shares available & as such reduces the value of each pre-existing share, e.g. by 1/10 of their original value.
Delete"If the existing shareholder purchased their original 100 shares for say £1 each, they spent £100 but now their shares are only worth £10. Today the company is valued at £15m with £650M debt.
After DfE they still only have shares worth £10, but the net debt will be £200M and the company will be valued at £450M. Over time, as long as the company hits their targets the share price recovers.
As part of the above agreement the remaining debt period will be extended, dividends will be paid next year attracting institutional investors – always the plan.
Institutional Lenders (banks) will not want to own shares in Interserve long long term and will support the growth to extricate themselves ASAP."
TOO BIG TO FAIL... through such twists & turns it seems that Interserve are being rescued by big financial institutions who have vast sums tied up in loans... and therefore Interserve MUST be granted new contracts to keep them viable.
Capitalism is obscene. It embodies the worst excesses of nepotism, narcissism & greed. It rewards the feckless, the incompetent & the vain.
One argument for the DfE from Interserve sebior management was "we care about the 75,000 workforce". Really? Like fuck, Interserve. You treat them like dogs. They are merely assets to be traded or written down. You drain the cash into your own pockets - £500,000 for 4 months' work - & keep staff on the poverty line, bullying them every day of their employment with you.
http://www.fm-world.co.uk/news/hausmanis-says-fm-on-alert-over-interserves-uncertain-future/
ReplyDeleteWith that is happening in interserve share price and crcs collapsing reading the latest Napo naff blog a mundane bore with claims of past pure fiction
ReplyDeleteI came out if napo, only ever need rep at a disciplinary, other than that we never see or hear from him despite on going issues. I've been to a couple of recent meetings after work and agendas very nps leaning. Waste of £20 per month.
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