Shares in Interserve have plummeted by 75% after the company revealed it was seeking negotiate a rescue deal.
The company’s share price fell to a record low of just 6p at 8.15AM, marking a 75% drop for the 24.5p closing price on Friday.
The plunge in the company’s share price came after it confirmed that it is seeking a rescue deal as it attempts to reduce its £500M debt.
However, the share price of the company, which employs 75,000 worldwide as well as 45,000 in the UK, recovered to 11.99p by 12.30PM on Monday.
The fall to 6p in early trading gave the company a market value of less than £9M. At its peak in 2014 Interserve’s share prices were worth more than 700p.
Interserve, which works in prisons, schools, hospitals and on the roads, has said it is “making good progress” on a long-term recovery plan.
While details of the plan are yet to be finalised and are expected to be announced early next year, Interserve has said that it will involve the issuing of new shares.
Last month, Interserve announced that it expected its year-end net debt is to be in the range of £625M to £650M, up from £503M last year.
In its trading statement covering the first nine months of 2018, the contractor revealed that its expected year-end net debt has increased due to further cash outflows on its energy from waste projects and an increase in credit given to firms in certain Middle Eastern markets.
However, the firm also said that it expects “significant operating profit improvement” this year.
Last month, the share price of Interserve also fell to its then lowest point in more than 30 years following a claim from waste-to-product manufacturer Renewi which said the firm had missed a deadline on a joint venture on an energy-from-waste plant in Derby.
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