Small Cap Value Report (Mon 10 Dec 2018) - IRV, PHTM,
Good morning, it's Paul here.
Markets remain grim. I've been taken aback by the speed amp; severity of recent falls in many small caps. Market timing isn't my thing, and I take a long-term view. So it's really just business as usual from my point of view, painful though it is.
Interserve (LON:IRV)
Share price: 12.8p (down 48% today)No. shares: 149.7mMarket cap: £19.2m
Deleveraging plan
This yet another outsourcing group to run into trouble. The share price has been in freefall recently, with a further plunge of 48% today on news of major dilution on the way for shareholders.
Today it says;
Interserve and its lenders are engaged in constructive discussions regarding the agreement and implementation of a deleveraging plan which would deliver a strong balance sheet with Interserve targeting leverage of approximately 1.5x net debt/EBITDA. These discussions also involve proposals to amend the Group's current financing agreements, including the extension of the maturity dates and repayment profiles of the existing facilities.
What's interesting about that, is that it echos a comment I made in one of last week's SCVRs, that banks are reducing credit in difficult sectors. In the previous few years,...