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Amigo Loan shares have fallen to a new £ 300m bailout plan

NS

Troublesome personal lender Amigo saw stock It sank further into Penny’s territory today as the company announced plans to raise £ 300 million.

Amigo has fought to save herself from collapsing underneath weight of compensation Claims related to historical misselling. The plan to provide partial compensation was rejected by the High Court in May, leaving Amigo on the verge of collapse.

The company today has two new plans Committee Represents that 82,000 missale client: One is to liquidate the business and the other is to raise new cash and resume lending.

The Commission supported plans to resume lending. This should provide higher payments to missold customers. Amigo promised the first £ 113m bailout, compared to just £ 35m under the plan rejected in May.

Part of the payment will be funded by better-than-expected performance of Amigo’s loan book during the pandemic, but will require new funding. Amigo plans to raise up to £ 300m in debt and capital from new and existing investors. We are looking for at least £ 70m in equity funding.

Amigo warned last week that investors are facing a plunge in stocks as investors are significantly diluted by bailout plans. Stocks held by about 8,000 individual investors today fell another 1p, or 13%, to 6.7p.

Amigo warned that “many hurdles remain.” Unsold customers still need to vote on the proposal, and the plan requires approval from the Financial Conduct Authority and the High Court. This process is expected to take 4 months.

CEO Gary Jennison said:

Amigo’s worries stem from claims that he did not perform sufficient affordable checks on guarantor loans that allow people to borrow money with guarantees from friends and family.

Amigo Loan shares have fallen to a new £ 300m bailout plan

Source link Amigo Loan shares have fallen to a new £ 300m bailout plan

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