Amigo Holdings PLC (LSE:AMGO) announced a temporary suspension of share trading for Monday and Tuesday ahead of a court decision on its new mis-selling compensation scheme.
The provider of guarantor loans in the UK expects the outcome of a court hearing for its proposed Schemes of Arrangement tomorrow.
There will be few attendees at the public hearing, so there will be a possibility of asymmetric information in the market if sensitive information were to be released prior to the company updating the market. it said.
Pending completion of the hearing, the company will request the suspension be lifted, it said in a statement.
In December the company announced it put forward two “distinct schemes,” with the Independent Customer Committee favouring the ‘New Business Scheme.’
The scheme would be expected to provide creditors with greater returns than the ‘Wind-down Scheme,’ with it contingent on new lending restarting and Amigo completing a successful equity raise.
In the event the court sanctions the New Business Scheme, Amigo proposes handing out cash contributions of £97mln from internally generated resources, alongside a further £15mln from new equity.
The initial cash contribution compares to an amount of up to £35mln in the previous scheme proposal, which was rejected by the judge in an earlier court hearing