Engineering consultant gains more time to refinance 拢91m debt pile incurred through acquisition spree
Engineering consultant White Young Green has reached an agreement with its banks to defer a covenant test date to the end of July.
The company is trying to refinance an estimated 拢91m debt pile with Lloyds Banking Group, RBS and Belgian-Dutch bank Fortis over fears it will breach its covenant on net debt to EBITDA (earnings before interest, tax, depreciation and amortisation).
The debt was racked up during a spending spree that saw the company blow 拢85m buying 18 companies in five years.
A company statement said: 鈥淭he board expects that a further deferral of the covenant test date will be requested. A further announcement will be made in due course as appropriate.鈥�
The margin on the banking facilities has been increased to 3% above LIBOR as a result of the deferral.
As part of a wider financial restructuring, the UK-based company also plans to raise an estimated 拢40m from investors.
It described trading as 鈥渕ixed and challenging鈥� but pointed to a number of recent contract wins including a 鈧�4.9m (拢4.1m) deal to support the European Commission in delivering a three-year programme for regional development in Serbia.
It reiterated that it expected to incur 鈥渟ignificant exceptional costs鈥� in the year to 4 July 2009 relating to redundancy and office closure costs, goodwill impairment and the writedown of work in progress and accounts receivable balances.
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