UK's Non-Standard Finance agrees tentative deal with lenders (updated)

Non-Standard Finance

14/04/2023 07:54

(Adds more detail)
    By Huw Jones
       LONDON, April 14 (Reuters) - British consumer lender
Non-Standard Finance  NSF.L  (NSF) said on Friday it has agreed
provisional terms with its lenders to convert 71 million pounds
($89 million) of secured debt into equity as part of a 
recapitalisation that would likely wipe out existing
shareholders.
    "It is anticipated the lenders would hold approximately 20%
of NSF's enlarged issued share capital if the proposed capital
raise is successful. As at 31 December 2022, the Company had
total gross debt of 255 million pounds," Non-Standard Finance
said in a statement.
    NSF said the indicative proposal from its lenders would
substantially improve its balance sheet following a successful
capital raising, underpinning prospects for strong growth in its
lending business and a return to profitability.
    "Although the proposed recapitalisation will ensure the
future of the Group and the Everyday Loans business, it will
materially dilute the interests of NSF's existing equity
holders, most likely to negligible value, unless they choose to
participate in the equity raise," the company said.
    Without strengthening the balance sheet, the group would
remain insolvent and most likely go into administration, the
company added.
    NSF said Non-executive Chairman Charles Gregson will stand
down after more than 8 years on the board. 
    At its annual meeting, Niall Booker will stand for election
as non-executive chairman to replace him.
    The subprime lender last month outlined plans to
recapitalise through a share sale.
    ($1 = 0.7977 pounds)

 (Reporting by Huw Jones; editing by Jason Neely)
 ((huw.jones@thomsonreuters.com; +44 207 542 3326; Reuters
Messaging: huw.jones.thomsonreuters.com@reuters.net))