Interserve break-up gathers pace with RMD Kwikform sale
Written by Rother Radio News on 30/11/2020
The break-up of Interserve, once one of the UK’s biggest outsourcing groups, is to gather pace with plans to sell the jewel in its crown for more than £150m.
Sky News has learnt that Interserve’s shareholders have asked bankers at Lazard to begin sounding out prospective buyers of RMD Kwikform, the group’s profitable equipment services division.
The launch of an auction could take place early in the new year, if the plans are approved by Interserve’s board in the coming weeks, City sources said on Monday.
RMD Kwikform provides engineering services to major infrastructure projects, and has been involved in various stages of construction at HS2, Crossrail, Battersea Power Station and the Hinkley Point nuclear power station.
The division employs about 1400 people, and is chaired by the City veteran Ken Hanna.
“It’s very well-placed to take advantage of the post-COVID infrastructure investment plans of governments,” an insider said.
RMD Kwikform operates in North America, the Middle East and Australia, among other markets.
In 2018, it recorded revenue of £195m.
Sources said that if a sale proceeded, it would generate substantial interest from financial and trade bidders.
It is the second time in four years that Interserve has examined the potential for a sale of RMD Kwikform.
In 2016, it opted not to offload the unit as the broader group began to run into financial difficulty which ultimately led to its brief collapse into administration.
The group emerged from an insolvency process under the control of funds including Angelo Gordon, Cerberus Capital Management and Davidson Kempner Capital Management.
At its peak, Interserve employed more than 45,000 people in the UK.
Following a deal to sell its vast support services arm to rival Mitie, however, the remaining Interserve group will employ approximately 12,000 people.
Insiders said the company was also in advanced discussions to sell its healthcare operations.
The disposal to Mitie of Interserve Facilities Management, which will complete on Tuesday, is expected to lead to the departures of some of the senior executives who steered it through the period after its insolvency.
Andy McDonald, the group general counsel, and Jonathan Refoy, group corporate affairs director, are understood to be leaving next year after playing key roles in the company’s rebuilding plans.
Lynn Mawdsley, who runs its facilities management arm, will leave at the end of the year.
An Interserve spokesman declined to comment.
© Sky News 2020