Recruitment giant launches £41m plan to drive down debt
Staffline, the Nottingham recruitment giant, is launching a drive to raise £41m to try and drive down its debt pile.
The Nottingham firm wants to raise £34m through a share offer and a further £7m through an open offer with shares priced at 100p each.
Earlier this month, Staffline said it will take a £32.6m hit to its bottom line over errors in historic compliance with National Minimum Wage regulations.
The firm said that a further review of the compliance issues had almost doubled the cost of amending the mis-payments from £7.9m to £15.1m.
A statement from Staffline this morning (27 June) said: “Following discussions with both the Group’s lenders and shareholders, the Board believes that reducing the indebtedness of the Group by way of the Placing and Open Offer is in the best interests of the company.
“Furthermore, the company’s lenders have agreed to waive covenant obligations in respect of the company’s indebtedness at 30 June 2019, and subject to the company raising equity, agreed to relax the Company’s covenant obligations at the next two quarterly test dates. ”
Meanwhile, Staffline also released its 2018 results this morning. They showed group revenue up 18% to almost £1.13bn, with underlying profit flat at £31.9m. Debt has soared over the year to £63m – up from £16.5m in 2017.
