Infrastructure firm Mouchel has signed a last-minute rescue with its banks, wiping out a large chunk of the struggling firm’s debt.
Mouchel, which provides consulting and business services on road building and other public sector projects, warned it will collapse under its £140 million debt pile at the end of this month if shareholders do not approve the debt-for-equity swap.
Royal Bank of Scotland, Lloyds and Barclays will release £87m of debt in exchange for a controlling stake in the business, safeguarding 8,000 jobs and leaving Mouchel with a more sustainable £60m-worth of debt.
The group, which has been hit by UK government spending cuts, has been behind major building projects more than a century after Frenchman Louis Gustave Mouchel brought the patent for reinforced concrete to the UK in 1897.
Mouchel’s woes were compounded last year when Richard Cuthbert resigned as chief executive after the company revealed a £4.3m accounting error.
Mouchel has bases in Glasgow and Perth, where it has a joint venture with Balfour Beatty, Scotland Transerv, which manages the trunk road network in the north-west of Scotland.
Further a field, its historic projects have included constructing the Royal Liver Building in Liverpool, the Widnes to Runcorn transporter bridge across the River Mersey and the pre-cast concrete “Mulberry” harbour, which was used in the Allied liberation of Europe.