Mouchel, the outsourcing firm that runs 13 city academies and maintains council infrastructure such as roads, will start bidding for major contracts again having been sold to its banks.
Grant Rumbles, chief executive, told The Independent that Mouchel, which saw its debt slashed from £147m to £60m after being bought out of administration on Saturday, was now secure enough to chase long-term deals. Mouchel had frozen pitches for major contracts because of its financial weakness.
"This will put us back on a profitable footing, so that by the end of September we will have the cost base right," said Mr Rumbles, who has cut £9m of overheads just in reducing the number of properties Mouchel works from. "In early 2013, we can start bidding for big, long-term contracts again. With pressure on local authorities to be more efficient there will be opportunities for us and we'll be able to go after five-to-ten year contracts again."
On Friday, shareholders snubbed a restructuring plan that would have seen them receive a penny for every pound of their investments. This forced management into an alternative restructuring, which was the same except with no payout to investors.
Lenders Lloyds, Barclays and Royal Bank of Scotland hope to regain what they have written off in three to six years.