UK's Amigo says exploring deals after failing to secure financing (updated)
17/10/2023 09:05
(Adds background on negotiations and Amigo's history)
Oct 17 (Reuters) - Struggling British subprime lender
Amigo Holdings AMGO.L said on Tuesday it was exploring
transactions, including buying a handful of early-stage
businesses in online streaming and payments, to deliver "some
small value" to shareholders.
The company, which is winding down after failing to raise
sufficient funds, said it was "effectively not possible" to
secure new financing and the proposed transactions it was
exploring would "potentially deliver some longer term value to
existing shareholders".
It has entered into an exclusivity agreement with investor
Craven House Capital CRV.L and others expiring on Dec. 14 to
negotiate a possible deal.
"Over the past few months we have remained open to
investment opportunities that would allow the business to
restart, but have always said the likelihood of success to be
very low. Unfortunately, that has been the case," Amigo CEO
Danny Malone said in a statement.
Malone, who earlier this year communicated his decision to
leave Amigo, has been asked by the company's board to remain in
his post until the end of the year to help with the
negotiations.
Amigo, which specialises in providing credit to borrowers
typically excluded by mainstream banks, has been pushed to the
brink of collapse by the cost of compensating past customers for
mis-sold loans.
(Reporting by Hani Kollathodi and Yadarisa Shabong in Bengaluru
and Pablo Mayo Cerqueiro in London; Editing by Kirsten Donovan)
((Hani.Kollathodi@thomsonreuters.com;))