Mouchel offloads rail unit for £3.4m as it tries to cut debts

Click to follow
The Independent Online

Mouchel is to sell its rail unit to Australian consultant Sinclair Knight Merz for £3.4m, the first in a series of expected divestments as the troubled business services group looks to address £87m debts.

"It's going to make a small dent [in group debt], it's part of the process," said a company spokeswoman.

Mouchel last year announced plans to sell non-core assets in response to mounting debt, a situation which worsened this month following the discovery of a £4.3m auditing error.

The company has appointed a new chief executive, Grant Rumbles, as well as two new interim chairman in the past week, as Mouchel has struggled to outline a "clear strategy" to address creditors' debt fears.

In July, the beleaguered company breached a banking covenant ahead of a voluntary repayment of £30m due in May.

In response to the SKM deal, David Brockton, an analyst at Espirito Santo, said: "This is positive news, but small and inevitably likely to be viewed as too little too late."

Comments