18th Dec 2023 14:21
(Alliance News) - Amigo Holdings PLC on Monday said it remains open to the idea of a reverse takeover to deliver value to shareholders after reporting a plunge in its half-year revenue.
Shares in Amigo, however, rose 10% to 0.17 pence each in London on Monday afternoon.
The Bournemouth, England-based mid-cost credit provider said revenue plunged 82% to GBP2.8 million in the half-year ended September 30 from GBP15.8 million a year ago, driven by the ongoing run-off of the legacy loan book, as well as minimal new lending during the period, it said.
It currently is in the process of winding down its lending business under a scheme of arrangement overseen by the UK Financial Conduct Authority, after Amigo was required to make millions of pounds in customer redress payments.
In October, it entered an exclusivity agreement with Craven House Capital, in which the two sides would discuss the idea of Amigo buying four businesses from Craven House that are in different fields from lending. This would be in exchange for new shares in Amigo.
However, Amigo said last month talks for a reverse takeover by Garimon Ltd and Honeydog Ltd, investees of Craven, were terminated at the request of "various individuals".
Meanwhile, pretax loss narrowed to GBP6.7 million from GBP12.7 million, as operating expenses decreased by 12% to GBP23.8 million from GBP27.2 million a year prior.
Amigo said it would not propose a final dividend for the year ending March 31, or an interim dividend, unchanged from a year ago.
Chief Executive Officer Danny Malone commented: "We remain open to assessing other viable options that could be beneficial for our shareholders, our people and wider stakeholders. A number of tentative indications of interest have been received, but none of these has as yet resulted in an executable proposal.
"We believe that a reverse takeover is the only possible prospect of delivering any future value for shareholders. In the meantime, we are focused on the important task of delivering redress due to those customers with a claim under our scheme of arrangement and ensuring the orderly wind down of operations."
CEO Malone is due to step down on December 31 and will be replaced by Chief Financial Officer Kerry Penfold, who will take CEO responsibilities alongside her existing role.
By Sabrina Penty, Alliance News reporter
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