RE: Fairness at sanction hearing11 May 2021 11:33
up we will go in good time.
However, Amigo has received a letter from the FCA stating that it now plans to appear at the Court sanction hearing to oppose the scheme, even if creditors agree to it. The FCA is concerned that while creditors' claims are being significantly reduced, other stakeholders are not being asked to contribute.
Broker Shore Capital said it doubts a Court will go against the wishes of creditors, especially when the majority voting in favour is likely to be so large, and it noted that the FCA has already said it is not proposing to take any additional regulatory action that might stope the scheme were it to be agreed by the creditors and sanctioned by the court.
"Amigo has also previously indicated that the business would be forced into insolvency proceedings if the scheme fails to win approval, in which case claimants would get nothing. As such, if the FCA was to be successful in stopping the scheme going ahead, this would likely see an even worse outcome for claimants, thus defeating its own objective.
"We think the FCA likely knows this and therefore is simply trying to be seen to do the right thing."