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Amigo Loans has said it expects to go insolvent over the next few months as the business continues its managed wind down.
Senior Journalist, covering the Credit Strategy and Turnaround, Restructuring & Insolvency News brands.
Earlier this year, the business announced it would be winding down its operations after struggling to gain the capital it needed to execute its scheme of arrangement. To do this, the firm needed to raise £45m to cover the equity required – however the firm hadn’t received enough interest to reach this figure.
In a statement published as part of its latest annual general meeting, the guarantor lender has said it continues to progress the “orderly wind down of the business”, ensuring it’s “able to maximise payments to redress its creditors”.
It added: “The company is solvent as a result of the arrangements put in place following the sanction of the Scheme and by virtue of the fact that it is supported by its subsidiary, Amigo Loans. Amigo Loans is required under the Scheme to liquidate once it has returned all net assets to its creditors.
“After the liquidation of Amigo Loans, Amigo Holdings, the ultimate parent company, will be insolvent as it has no resources of its own. We anticipate this will happen in the next few months.
“Under the applicable rules the listing of Amigo Holdings on the London Stock Exchange would be automatically cancelled upon the appointment of a liquidator to Amigo Holdings.
“Since the group started to wind-down the company has been open to any expression of interest from third parties in all or any assets of the business. The company continues to be open to viable expressions of interest in all parts of the business.
“However, in this context, should there not emerge, very soon, a viable alternative solution, the company will need to hold a separate general meeting, in which shareholder approval will be sought to delist the company from the London Stock Exchange and to enter the company into a members voluntary liquidation. In such a situation there will be no value remaining for to shareholders.”
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