Interserve PLC (LON:IRV) saw its share price slide in mid-morning trading Wednesday after saying it would seek shareholder approval to increase borrowing limits as it expects to record "significant balance sheet write-downs" in its 2017 annual results.
The support services and construction company said it had called a general meeting on April 27 to secure the approval and to ratify any existing breaches of its borrowing limit.
The group has already secured the backing of two major shareholders Coltrane Asset Management LP and Farringdon Capital Management, who together own around 35% of the company shares, for the proposed limit raise.
The write-downs are expected to comprise an impairment of goodwill as well as several other non-underlying items, with the majority of the exceptional items being either non-cash or reflected in the company's year-end net debt guidance of £513mln provided in January, Interserve added.
The group also said it had secured agreement in principle from lenders on the major commercial terms of its proposed refinancing, which would see the company obtain £834mln in cash borrowing facilities until September 2021.
The refinancing is expected to be completed by the end of April 2018.
Interserve shares were down 2.5% at 81.3p.