Jarvis extends loan facilities
JARVIS, the rail services group, said yesterday it had been granted extended banking facilities until 2011.
But the deal with Burdale Financial Limited, a subsidiary of Bank of Ireland and Bank of America, will see its asset backed loan facility reduced to £50m from £60m.
Jarvis, which has contracts with National Rail including signalling projects, was hit earlier this year as the transport group delayed its repairs timetable.
The loan facility is backed by the group’s assets, which include receivables – money owed to the company.
The group’s workload is falling as its customers scrimp in the downturn.
But Jarvis said it did not expect the extended banking facility to hit liquidity. The company’s cost of debt will go up by 0.35 per cent as part of the agreement.
“We are delighted to have been able to agree the extension of our working capital facility,” Jarvis executive chairman Steven Norris said
“It is particularly pleasing to have reached this agreement despite the current difficult debt markets and we appreciate the continuing support of our bankers,” he added.
The company issued a profits warning earlier this year.