Cppgroup Share News (CPP)

LONDON (Alliance News) - CPP Group PLC Monday said the value of its Scheme of Arrangement redress claims in respect of direct sales made by the group at the end of August stood at GBP32 million.

A Scheme of Arrangement is an arrangement between a company and its creditors and can help with the re-organisation of a company?s finances. The Scheme has to be approved by a court, and requires the consent of a majority of creditors.

The life assistance business said the total cost provided for customer redress and associated costs remains unchanged at GBP59.8 million, as stated in its interim results on August 29.

As previously announced, the group's plans to restructure the balance sheet "remain essential," with options currently being evaluated to strengthen the reduced capital position in order to support the company's future development.

Whilst claims throughout the Scheme process since February have tracked broadly within expectations, the response rate as at August 30 was around 42%, the company said.

CPP said a waiver has been agreed with its lenders with regard to this aspect of the group's covenants.

"The end of the Scheme represents a significant milestone for the business," Chief Executive Brent Escott said in a statement. "Its impact, nonetheless, has been considerable and consequently, the group's financial resources and liquidity is significantly reduced. Work is progressing to restructure the group's balance sheet and to provide a stronger platform from which the business can look forward.

The stock was quoted up 3.9% at 13.64 pence Monday.

By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews

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