Connect with us

Hi, what are you looking for?

World News

MARKET REPORT: Amigo fights for survival after £45m cash talks fail

Struggling: Amigo has been on a lifeline since being suspended on loan by the Financial Conduct Authority

MARKET REPORT: Shares in embattled Amigo plummet as it scrambles for survival after revealing talks to raise £45m failed

Shares in beleaguered Amigo tumbled as it scrambled for survival after revealing talks to raise £45m had failed.

In an update on fundraising plans, the struggling lender said it was now “unlikely” to find the necessary money before the regulator’s deadline of May 26 this year.

Amigo added that it had ‘indications of interest’ in share capital subscriptions to fund £21m, consisting of £11m of ordinary share capital and £10m of exchangeable notes .

The Bournemouth-based subprime lender has been on a survival basis since being suspended from making loans by the Financial Conduct Authority after failing to carry out proper affordability checks and for making low-rate loans interest rate to borrowers with weak credit histories.

Amigo won High Court approval for a recourse plan last year and was given the green light by the FCA to restart lending in October. Under the terms of the scheme, the company was to raise £45 million from investors.

Struggling: Amigo has been on a lifeline since being suspended on loan by the Financial Conduct Authority

Struggling: Amigo has been on a lifeline since being suspended on loan by the Financial Conduct Authority

In a meeting with shareholders on Wednesday, before talks broke down, bosses said that after approaching 200 potential backers they had failed to secure needed cash and warned that a ” fallback” of an orderly liquidation of the company was the only viable alternative if investors did not materialize.

The shares were floating at 275p in June 2018. This valued the company at £1.3billion.

But it is now worth just £10.4m after the shares fell 13.6%, or 0.3p, to 1.9p.

The FTSE 100 fell 1.7%, or 131.63 points, to 7748.35 and the FTSE 250 fell 1.7%, or 335.44 points, to 19357.46.

New data showed the economy rebounded, growing 0.3% in January. That was more than the 0.1pc economists were expecting after falling 0.5% in December.

Across the Atlantic, the latest US jobs figures showed the world’s biggest economy added 311,000 jobs last month. That was more than the 220,000 jobs predicted by economists.

Back in London, Schroders fell 4%, or 19p, to 460.1p after Credit Suisse downgraded the wealth manager’s rating from “outperform” to “neutral” and cut the target price to 470p from 510p. The broker said he expected the business to face higher costs.

Things didn’t look much brighter at Segro after Barclays downgraded the commercial property group to ‘equal weight’ from ‘overweight’ and cut the target price to 800p from 900p. The shares fell 1.1%, or 8.6p, to 770.6p.

Berkeley remained optimistic about demand for homes in London and the South East despite falling sales. The homebuilder said sales since the end of September last year were around 25% lower than in the first five months of its fiscal year, after mortgage interest rates rose and costs for potential property buyers. But the selling prices over the four months preceding February 28 were above the group’s objectives. He also reiterated that he is expected to make around £600m in profit for the year to April 30. The shares rose 0.07%, or 3p, to 4039p.

Meanwhile, First Group has forged ahead after bus passengers increased with the help of government schemes across England and Scotland. The transport operator said passenger volume on its buses had risen to 83% of 2020 levels as the shortage of drivers eased.

As a result, its profit for the year to March 25 should be higher than previous expectations. The shares rose 1.8%, or 1.9p, to 108p.

Graphene company Versarien plunged 34.5%, or 1.74p, to 3.31p after founder and chief executive Neill Ricketts, who helped the company float on AIM in 2013, stepped down. A spokesperson said: ‘The board is considering the appropriate long-term management structure of the business.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like


When you apply for a personal loan, lenders first determine your credit score to know how credible and reliable you are. This means that...


Loans against property are a common option for people needing high-value cash. Given that its interest rates are almost 3% to 4% more than...


It’s fun to be a student, especially if you’re motivated to achieve. However, it’s getting harder for students to focus in today’s busy society....


House Movers London is perfect for all types of moving needs. So, if you are looking for some reliable movers in London, then you...