Challenger Acquisitions Limited (LON:CHAL) saw its shares jump on Wednesday following news that the firm has cancelled £544,556 in convertible loan notes and will record a gain on the transaction and the related interest savings.
The group said it had executed a Convertible Note Purchase Agreement with two existing and independent convertible note holders.
Prior to signing of the agreement, the firm said, its last remaining holder of the original 6 May 2015 convertible notes held £639,556 of convertible notes and had received 12% interest up to 31 December 2016.
Challenger said the note holder had agreed to transfer £95,000 of these convertible notes to another existing note holder and to transfer, at no cost, the remaining £544,556 - £639,556 less £95,000 - of notes back to the company.
It added that the note holder also agreed to forgive all interest owing from 1 January 2017 to closing of this transfer, which approximates to £115,000.
Mark Gustafson, Challenger's chief executive officer, said, "This reduction in the overall debt level and the related interest savings has been a very important development for Challenger in order to move the Company forward.”
In early morning trading, Challenger shares were 37.5% higher at 0.33p.