MDIS suspends share listing

Dealings in shares in beleaguered McDonnell Information Systems computer services group were suspended yesterday pending the results of a rescue refinancing package. MDIS is trying to raise more than pounds 20m through a placing of new shares and is expected to announce it made a loss of almost pounds 40m in 1996. It lost pounds 39.4m in 1995.

MDIS has been forced to make huge provisions to cover a host of loss- making contracts it took on several years ago. John Klein, chief executive who joined the group last year as part of a management shake-up, is desperate to draw a line under a disastrous few years for the group.

"We have thrown the kitchen sink at it. This is an attempt to create a new start for MDIS after the problems of the past," a company spokesman said.

MDIS' advisers, Close Brothers, insist that they would be able to raise enough money to save the group. "The refinancing is progressing well and the demand for shares is encouraging," said Colin Keogh, chairman of Close Brothers corporate finance yesterday.

It is thought existing shareholders could subscribe for more than half of the shares. Most of the original investors in MDIS already bailed out when the true extent of its problems came to light soon after its flotation.

One industry source suggested that many of its current shareholders only bought shares recently and are sticking by the group in the hope that the loss on their investment can be mitigated.

MDIS has been one of the worst new issues in recent years. It was floated by Barings and NatWest at 260p just over three years ago and the shares have plummeted to just 23.5p before being suspended. Its market value has slumped from pounds 260m to pounds 25m.

Last month MDIS made its fifth profit warning since it floated. It said it would make "very substantial" losses for the year to December 1996 and would have to raise money to rebuild its balance sheet and cash position. Its problems stem from taking on contracts that it was unable to service properly.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific