24th Aug 2020 10:20
(Alliance News) - Amigo Holdings PLC on Monday noted statements from former chief executive James Benamor which detailed his plans to return as chief executive but backed newly-returned CEO Glen Crawford, urging Benamor not to waste time or money in his bid to return.
Shares in Amigo plunged 25% in morning trade in London to 13.31 pence each.
The struggling sub-prime lender said that while it agrees it continues to face significant challenges to its ongoing operations, it believes that the reappointment of Glen Crawford as CEO is a critical step for the business in navigating through its issues and returning the company to full health as quickly as possible.
In July, Bournemouth, England-based Amigo said Crawford would return to the role of chief effective from August, a position he held from February 2016 but left in April 2019 in order to undertake medical treatment.
The announcement of Crawford's return came after majority owner of Richmond Group Ltd Benamor, called for Amigo's entire board to be ousted after saying the company is "committing slow motion suicide". However, shareholders rejected Benamor's resolutions.
In a social media post on Friday, the Financial Times reported that Benamor stated he wants to return to the company to lead an international expansion while fighting what he described as "unethical" UK authorities.
Under Benamor's plan, incumbent Chief Executive Glen Crawford would keep control of Amigo's UK-regulated Amigo Loans focusing on cost cutting and shrinking debt, as well as embarking on a judicial view of the Financial Ombudsman Service's handling of customer complaints. Benamor himself would take over parent company Amigo Holdings to build new businesses in markets that, the FT quoted, "unlike the UK regulated market, enjoy fair and stable rule of law".
However, Amigo said Crawford has made it clear to he is not prepared to work with Amigo in any circumstances where Benamor returns to Amigo's governance structure in a position of influence. It added that Crawford's decision to return as CEO was based on the clear statement from Benamor that he would completely sell down Richmond Group's 61% stake in Amigo.
"In the event that Benamor elects to requisition a general meeting for shareholders to vote on his proposals, and should he be successful in gaining shareholder approval for his proposals, the board has agreed with Mr Crawford that he may terminate his employment contract immediately. The board is strongly of the view that such an outcome would be materially detrimental to the interests of the company," Amigo said.
"Crawford and the board are therefore equally aligned in their unanimous rejection of the views and proposals put forward by Benamor on Friday evening. The board therefore urges Benamor not to waste further time and expense for either Richmond Group or Amigo in seeking to bring his proposals to a shareholder vote," the company added.
By Ife Taiwo; [email protected]
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