Contractor secures funds after cash plea
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Troubled maintenance firm Connaught has agreed a £15 million overdraft with its lenders.
The company, which issued a statement on Monday saying its was in talks with its banks and urgently needed cash, said it had agreed the terms of the short-term overdraft, which is available immediately. It also said it had agreed to defer payments on its existing borrowing facilities in July and August. The overdraft is in addition to its current borrowing facilities of £200.6 million.
The firm will talk to its lenders about restructuring its finances in the longer term.
Connaught’s chair, Sir Roy Gardner, said: ‘We are delighted by this tangible evidence of support from our lenders. We will now seek to put in place arrangements which will leave Connaught on a more secure footing for the longer term.’
The firm has a large number of contracts with social landlords to provide maintenance and decent homes work.
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Readers' comments (7)
Progressive Solutions Required | 30/07/2010 12:21 pm
'We will now seek to put in place arrangements which will leave Connaught on a more secure footing for the longer term' - employer speak for sacking staff!
Loans underpinned by borrowing - now where did we come across that 'solution' before?
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Anonymous | 30/07/2010 2:44 pm
Author of the story obviously didn't read what's written in today's FT.
"Although the cash injection gives Connaught some breathing space, the group is still set to breach the terms of its loand as it warned earlier this week that net debt would be higher at its financial year-end next month than the £120m it had previously agreed."
Geoff Allum, equity analyst at Arden Partners, said: "This sum [ £15m ] is not going to keep them going for long".
Connaught has to turn up at Travis Perkins with the readies in its hand.
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Progressive Solutions Required | 30/07/2010 3:18 pm
As I said:
Loans underpinned by borrowing - now where did we come across that 'solution' before?
And we are to place ourselves at the mercy of such companies for our future?
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Christopher Webb | 30/07/2010 5:02 pm
Short term thinking will inevitably lead to failure.
Proof - banking industry; oil exploration; CCT; New Labour; Shapps; and now Connaught - next?
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Anonymous | 30/07/2010 5:10 pm
As usual, PSR and CW spouting national socialism, by way of the Beano.
What exactly does "loans underpinned by borrowing" actually mean in the world of PSR and CW?
It is certainly not a meaningful financial expression. If loans are anything, maties, they are borrowings. So are the wits saying borrowings underpinned by borrowings.
Never mind. Connaught is operating as any national socialist venture approved by PSR and CW would choose to, the only difference being that these financial nincompoops would have the taxpayer underpinning the loans.
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ILAG | 31/07/2010 0:11 am
The £37Bn contractors feeding frenzy that was DHS is over. Who's blood are these vampires going to suck next? The trough has been drained so where are these new DHS contracts going to come from? The Stork? I can see some sackings ahead at the banks who have bailed them out...
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Christopher Webb | 02/08/2010 10:00 am
anon - I do not believe I have used the quote you attribute to me.
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