UK sub-prime lender Amigo Holdings to become a shell company

(Reuters) -British sub-prime lender Amigo Holdings said it intends to appoint liquidators for its operating subsidiaries as it continues to explore a potential reverse takeover.

The company will become a shell after the wind-down.

Amigo, which offered high-interest loans to borrowers excluded from mainstream banks, was censured by the Financial Conduct Authority in 2023 for mis‑selling loans, leaving many customers struggling with unaffordable debt.

Last November, Amigo said it would voluntarily liquidate if it failed to find a partner, as compensation costs for mis-sold loans pushed it to the brink of collapse.

Since then, it has shut its legacy business, seen its chief executive depart and cut corporate costs to secure short-term cash.

"We are pleased that we will be able to continue (and hopefully successfully conclude) our discussion with reverse takeover targets for a few more months," CEO Nick Beal said.

Amigo said it expects to fund working capital from a residual pool of cash as it undergoes a solvent wind-down.

(Reporting by Unnamalai L in Bengaluru; Editing by Tasim Zahid)