Finablr PLC (LON:FIN) has said it is planning for potential insolvency and engaged an accounting firm to draw up contingency plans as it teeters on the brink of collapse.
The announcement follows an update on Monday when the owner of the Travelex foreign exchange brand said it was experiencing a number of factors that were “placing significant constraints” on its liquidity and that it was no longer able to provide certain payment services to its clients.
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Shares in the group were also suspended yesterday at the behest of the Financial Conduct Authority (FCA) after the company said it had discovered around US$100mln (£81mln) in previously unknown cheques that may have been used as “security for financing arrangements for the benefit of third parties”.
As a result, the company had warned that it was unable to accurately assess its financial position and there was “material uncertainty” around its ability to continue operating.
The group’s chief executive, Promoth Manghat, has also stepped down from the firm but will remain in place until a successor is appointed. The company has also established a committee of independent non-executive directors to review its liquidity.
Finablr is controlled by a company owned by the family of BR Shetty, the founder of private hospital operator NMC Health PLC (LON:NMC), which is currently facing its own FCA investigation after an independent review of the company’s finances uncovered “potential discrepancies” in bank statements, together with supply chain financing arrangements that had not been approved by the board.