The firm is expected to make significant fresh write-downs in its 2017 results after a group-wide contract review.

It is anticipated that net debt at the year-end 2017 will stand at around £513m.

The extended £834m funding deal agreed with banks last month crucially does not chip away at the debt mountain, expected to rise to £600m this half.

Extended borrowing limits needed to be ratified by shareholders after banks agreed to provide extra cash facilities of £197m and fresh bonding up to £95m.

As part of its extra financing , Interserve’s banks have options to buy new shares, presently worth 104p, for 10p per share, which if exercised, would give them a 20% stake in the group.

Interserve’s banks have also agreed to extend a looming covenant test to the end of April to allow documentation to be finalised for the refinancing.

The new facilities will mature in September 2021.