Concern over lockdown
Stagecoach seeks taxpayer loan extension
Stagecoach revenues are down sharply
Transport company Stagecoach wants extra time to repay a £300 million taxpayer-backed loan as it remains uncertain over the return of passengers and the reopening of offices, according to a report.
The company is understood to have begun renegotiations over extending the loan from the Bank of England for a further 12 months.
An extension to the first £100m will be followed by new terms for the remainder, according to the Mail on Sunday.
The new terms will mean Stagecoach – which operates 8,000 buses, trams and light trains across Britain and employs 24,000 staff – will not have to repay the loan until February 2022.
Revenue at the company fell sharply in the half-year to the end of October, although it remained profitable.
The loan was raised as part of the Covid Corporate Financing Facility which was aimed at easing the pain for the biggest firms. The CCFF still has £11.5billion on loan to about 50 of Britain’s largest businesses.
The paper says some are already arranging repayments.
Hospitality and manufacturing firms also make up a significant portion of the remaining CCFF loans which have been agreed on low interest rates of 0.5% or less.
They were designed as emergency lines of credit for firms that would have struggled to obtain access to debt or additional cash during the height of the crisis.
The company introduced a recruitment freeze, salary sacrifices for directors and senior management and a reduction in capital expenditure.