22nd Dec 2016 11:29
LONDON (Alliance News) - Ranger Direct Lending Fund PLC said Thursday the bankruptcy of an online lender to which it has indirectly provided credit lines is not expected to harm its net asset value or dividend payments.
Chicago-based online personal lender Argon Credit has filed for Chapter 11 bankruptcy. Ranger Direct said it has indirectly provided around USD28.3 million in credit lines to Argon via an agreement with an unnamed credit line platform which provided funding to Argon.
The unnamed credit line platform's investment in Argon was secured by the online lender's entire portfolio of loans. The credit line platform claims that a portion of the underlying collateral was assigned by Argon to an unapproved special purpose vehicle controlled by a former employee, in breach of its credit agreement.
Ranger said the credit line platform's management currently do not expect to have to write down the value of its investment in Argon, due to the security package of the loans and an expectation it will recover the allegedly mis-assigned collateral.
Specifically, Ranger said the credit line platform expects it can gain control of a "substantial proportion" of the security assets within the next month, dependent on the permission of the bankruptcy court.
"Whilst there may be some impact on the timing of receipt of income by the SME credit line platform (and, therefore, indirectly the company), the Argon bankruptcy proceedings are not currently expected to have an impact on the company's NAV or aggregate dividend payments," said Ranger Direct Lending.
Shares in Ranger Direct Lending Fund were down 2.5% at 1,131.00 pence Thursday morning.
By Adam Clark; [email protected]
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