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Sunday 19th of September 2010

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September 15, 2010

Cattles fails to convince bondholders

by Gill Montia

Story link: Cattles fails to convince bondholders

Cattles has announced that negotiations with some of its bondholders have broken down.

However, the firm and its advisers are continuing their discussions with representatives of certain key financial creditors, in the belief that the interests of all parties are best served by reaching an agreement.

The sub-prime lender, which trades as Welcome Finance and Shopacheck, ran into trouble last year when it emerged that a breakdown in internal controls had led to impairment policies being incorrectly applied.

In March 2009, the firm issued two profit warnings within days and announced that its 2008 results would be delayed.

Six directors director of the firm were then suspended, as Cattles said it would need to restate its 2007 figures, and a review carried out by Freshfields and Deloitte resulted in their eventual dismissal.

Currently, the lender is working on plans for a restructure that includes a proposal for a newly incorporated company that would acquire the entire issued share capital of Cattles, at a nominal value of up to 1p per share.

 

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