RNS24 Mar 2021 07:05
FOR IMMEDIATE RELEASE
24 March 2021
Amigo Holdings PLC ('Amigo' or the 'Company')
Regulatory Update Regarding Scheme of Arrangement
Amigo Holdings PLC (LSE: AMGO), a leading provider of guarantor loans in the UK, provides an update on the Scheme of Arrangement (the 'Scheme') following a notification by the Financial Conduct Authority (the 'FCA').
As announced on 25 January 2021 and updated within our financial results on 25 February 2021, Amigo and ALL Scheme Ltd ('SchemeCo') have been in discussions with the FCA as the terms of the Scheme have been finalised and to respond to the issues and concerns raised by the regulator.
The FCA notified Amigo and SchemeCo after market close on 23 March 2021 that, having completed its assessment of the terms of the Scheme, while the FCA does not support the Scheme, it is not currently proposing to take any additional regulatory action that might stop the Scheme were it to be agreed by the Scheme creditors and sanctioned by the Court, but the FCA reserves the right to change its position. This is based on information currently made available to the FCA, including the skilled persons report, relating to the Scheme, which is in the process of finalisation. The Scheme creditors are Amigo's 700,000 past customers, 300,000 present customers and the Financial Ombudsman Service (the 'FOS').
The FCA considers that the Scheme may not be compatible with the FCA's rules, principles and strategic objectives. In particular, the FCA has identified certain concerns with the Scheme which it has drawn to the attention of Amigo and SchemeCo and, in turn, will be drawn to the attention of the Court at the convening hearing. The concerns of the FCA include the fact that customers with valid redress claims in the Scheme stand to receive significantly less than the value of their claims and the methodology for claims assessment, in comparison to the typical approach of the FCA and FOS.
Amigo and SchemeCo continue to believe that the Scheme will provide the best outcome for both past and present customers in a manner that is fair and equitable. Amigo and SchemeCo expect customers and the FOS to be given the opportunity to decide for themselves whether to support the Scheme or to oppose it in favour of the alternative, an insolvency proceeding, notwithstanding any concerns which the FCA may have.
Gary Jennison, CEO of Amigo, said: "We are grateful for the work of the FCA and the time they have dedicated to understanding and enhancing Amigo's Scheme of Arrangement. Their letter is a significant step forward ahead of the first court hearing next week. We look forward to our customers having an opportunity to vote and support the Scheme, which after careful consideration, we believe, is the only real option for customers who are due redress to receive cash compensation. Given it is in their best interests, we strongly encourage our 700,000 past customers and 300,000 present customers to support the Scheme.
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