Shares in Minoan Group PLC (AIM:MIN) plunged 72% on Frday after the AIM-listed company warned it may be forced to suspend trading early amid a worsening financial crunch and looming creditor action.
The holiday and leisure-focused developer has run out of cash and says it won’t be able to complete its audit by the end of April, the deadline required to stay listed.
A formal suspension is now expected from 1 May, though the company admits it may have to halt trading sooner to protect creditors.
Behind the scenes, Minoan is scrambling to finalise a rescue deal with DAGG LLP, its main lender, which is owed around £1.2 million and has been charging default interest of 22% since January.
DAGG is now proposing a full debt-for-equity swap, plus a £4.4 million cash injection, in exchange for control of the business.
While the deal could stabilise the group, existing shareholders would face heavy dilution if it goes ahead. Talks remain ongoing.
The stock was off 0.23p at 0.091p.