(Reuters) British subprime lender Amigo Holdings fell up to 58% on Monday after the company warned of insolvency following doubts of a business rescue plan of $131.18 million.
The fall in the shares happens even as the company’s rescue plan was initially rejected by the London High Country in May 2021.
Amigo’s likely rights issue of more than 19 new shares also failed to get the creditors’ nod, with the issue expected to dilute the holdings of existing investors.
Amigo CEO Gary Jennison said that the rescue plan provided additional protection for creditors while addressing some concerns raised by the court. He says the plan is necessary for the company’s survival.
AMGO: LON is currently down -38.40%.
