LONDON, UK: Amigo Holdings PLC, a UK-based mid-cost credit provider that is winding down its lending business, has announced that it has signed an exclusivity agreement with Craven House Capital plc and others to explore a deal that could see Amigo acquire four digital businesses in exchange for new shares and raise at least £5m in cash from new investors.
The four digital businesses are: ONE Bas.com, a music streaming service; Magazinos, a worldwide digital magazine platform; TV Zinos, a film streaming service; and Payzinos, a payments provider. The agreement gives Amigo and Craven House until 14 December 2023 to finalise the terms of the deal, which is subject to due diligence and regulatory approvals.
Amigo said that the deal would potentially deliver some longer term value to its existing shareholders, who would be significantly diluted by the new share issuance. The company also said that the costs of the deal would be borne by the new investors even if the deal does not go ahead.
The company’s listing on the London Stock Exchange has been suspended at its request, pending further details on the deal or an announcement that it is not proceeding. The company said that the suspension was necessary because of the lack of information about the four digital businesses in relation to the deal.
Amigo is currently undergoing a scheme of arrangement and a wind down of its historic lending business, which have been affected by regulatory changes and customer complaints. The company’s CEO, Danny Malone, who had resigned in May 2023, has agreed to stay on until 31 December 2023 to help with the negotiations of the deal.
Malone commented: “Over the past few months we have remained open to investment opportunities that would allow the business to restart, but have always said the likelihood of success to be very low. Unfortunately, that has been the case. The proposed transactions offer a solution that, if complete, would deliver some small value to shareholders which wouldn’t be possible otherwise.”