REG - Amigo Holdings PLC - Update on Capital Raise and Pilot Lending

Amigo HoldingsAnnouncement

27/01/2023 07:00

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RNS Number : 0365O  Amigo Holdings PLC  27 January 2023

27 January 2023

Amigo Holdings PLC

 

Update on Capital Raise and Pilot Lending

Amigo Holdings PLC ("Amigo" or "the Company"), a provider of mid-cost credit
in the UK, is today giving an update on its proposed Capital Raise and the
pilot lending programme.

Capital Raise

Amigo's Scheme of Arrangement, sanctioned by the High Court in May 2022 (the
"Scheme"), contains a preferred solution which is conditional on the
completion of a 19:1 capital raise by 26 May 2023 (the "Capital Raise"),
followed by the contribution of a minimum £15m payment to the Scheme fund for
creditor redress.

Further to the market update issued on 16 January 2023, the Company has
received a number of expressions of interest to support the Capital Raise.
However, this remains below the targeted £45m of equity funding that the
business requires and discussions are therefore ongoing. The Board continues
to seek the best possible outcome for creditors, employees, shareholders, and
other stakeholders. As outlined previously, if the Capital Raise is not
completed, or the Board determines that it cannot be achieved, by 26 May 2023,
the Scheme will revert to the fallback solution outlined in the Scheme (the
"Fallback Solution"), which is an orderly wind-down of the business.

Amigo's cash position remains strong and, in the event the Fallback Solution
is invoked, the seniority of the secured notes will be respected. The Fallback
Solution would result in no value being attributed to the Company's ordinary
shares.

Pilot lending

The Company initiated a pilot lending programme in late October 2022, shortly
after receiving approval from the FCA to return to lending, under certain
agreed conditions.

While the initial volume of loans written was very limited, volumes have
increased substantially during January 2023. On the current run-rate, monthly
originations are around £1m and expected to continue to grow as the
conversion rate improves through the application of the learnings from the
pilot lending period. Amigo retains its cautious approach to underwriting as
it assesses the impact on customer affordability from the cost-of-living
crisis.

The volume of completed loans has now reached a level such that the 'Skilled
Person' testing of lending outcomes has commenced.

ENDS

Enquiries

 Company
 Amigo Holdings PLC         investors@amigo.me
 Kate Patrick               Investor Relations and External Affairs Director
 Roger Bennett              Company Secretary

 Media enquiries            Amigoloans@lansons.com
 Tony Langham               07979 692287
 Ed Hooper                  07783 387713

 Peel Hunt LLP              020 7418 8900
 James Britton
 Oliver Jackson

 Ashcombe Advisers LLP      0207 529 5800
 Andreas Wesemann
 Adrian Hobcroft

About Amigo Loans

Amigo is a public limited company registered in England and Wales with
registered number 10024479. The Amigo Shares are listed on the Official List
of the London Stock Exchange. Since October 2022, Amigo has offered guarantor
loans and non-guarantor personal loans under its RewardRate brand. Both
products reward customers for on-time payments with an annual, interest-free,
payment holiday and the opportunity to reduce the effective APR, encouraging
better financial management and facilitating a long-term improvement of
customers' credit scores and financial mobility. Amigo has provided guarantor
loans in the UK from 2005, offering access to mid‐cost credit to those who
are unable to borrow from traditional lenders due to their credit histories.
The guarantor loan concept introduces a second individual to the lending
relationship, typically a family member or friend with a stronger credit
profile than the borrower. This individual acts as guarantor, undertaking to
make loan payments if the borrower does not. Amigo's back book of loans issued
pre-November 2020 is in the process of being run off with all net proceeds due
to creditors under a Court approved Scheme of Arrangement. Amigo Loans Ltd and
Amigo Management Services Ltd are authorised and regulated in the UK by the
Financial Conduct Authority.

Additional Information

This announcement is not intended to, and does not, constitute or form part of
any offer, invitation, or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell, or otherwise dispose of, any securities, or the
solicitation of any vote or approval in any jurisdiction, pursuant to this
announcement or otherwise.

This announcement constitutes notice by Amigo Luxembourg S.A. (the "Issuer")
to the holders of the Issuer's 7.625% Senior Secured Notes due 2024 (for the
notes issued pursuant to Rule 144A of the United States Securities Act of
1933, ISIN: XS1533928468 and Common Code: 153392846; for the notes issued
pursuant to Regulation S of the United States Securities Act of 1933, ISIN:
XS1533928625 and Common Code: 153392862) (the "Notes") issued pursuant to
pursuant to Section 4.03(a)(3) of an indenture dated January 20, 2017 among,
inter alia, the Issuer, the guarantors named therein and U.S. Bank Trustees
Limited, as trustee and security agent. Amigo Holdings PLC is the indirect
parent company of the Issuer. This announcement shall constitute a "Report" to
holders of the Notes.

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