4th Jan 2022 10:13
(Alliance News) - Amigo Holdings PLC on Tuesday confirmed the early redemption of the majority of its outstanding senior secured notes due in 2024.
The guarantor loan company announced plans to redeem GBP184.1 million of its GBP234.1 million outstanding 7.625% senior secured notes due 2024.
Amigo said the remaining GBP50 million outstanding is due in January 2024.
The early redemption will be at par and the expected future interest savings of GBP28.1 million will form part of the increased cash contribution for the proposed scheme of arrangement, announced in early December.
On December 6, Amigo's share price suffered a hefty blow after the Independent Customer Committee confirmed its preference for the 'new business' scheme of arrangement, but warned of insolvency if all schemes are shot down.
The scheme concerns the settlement of claims following probes from UK regulators into mis-sold loans and the way that Amigo dealt with customer complaints.
In September, Amigo submitted a revised scheme proposal, incorporating feedback from the Independent Customers' Committee, along with its future business plan to the Financial Conduct Authority and the ICC. Amigo first pursued the use of a scheme of arrangement, in order to attain certainty on the total liabilities which arise from customer complaints, in December last year.
The new business scheme, which was first proposed to the ICC on November 12 last year, is dependent on the restart of lending operations by the firm as well as the securing of money through an equity raise.
Amigo has said it would contribute GBP97 million in cash from internally generated resources, alongside GBP15 million from an equity raise, under the new business scheme. The initial cash contribution compares to an amount of up to GBP35 million in the previous scheme proposal.
Amigo shares were down 1.9% to 5.88 pence each in London on Tuesday morning.
By Greg Roxburgh; [email protected]
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