Cattles considers sale at 1p per share
by Gill Montia
Story link: Cattles considers sale at 1p per share
Doorstep lender, Cattles, is considering a proposal that would allow a newly incorporated company to acquire the firm for 1p per share, or less.
The plan, which has evolved through discussions with the company’s creditors over the restructuring of its debt, involves the creation of a new entity that would be managed by a corporate service provider and ultimately owned by a charitable trust.
Last year, the troubled sub-prime lender admitted to the incorrect application of impairment policies at its Welcome Finance unit, and embarked on a board-room clear out.
Welcome Finance closed to new business earlier this year and the group is still working to establish who was responsible for the irregularities that occurred.
Cattles recently submitted restated accounts for 2008 showing a pre-tax loss of £745.2 million, compared with an estimated loss of £555.3 million.
At the same time, the group warned that it will be reporting a significant loss for 2009, a forensic review having exposed a “very significant” shortfall in the lender’s impairment provisions.