Amigo Loans bosses to pocket £327m in flotation

0
10



Amigo Loans bosses to pocket £327m in flotation skynews amigo loans ipo loans 4348751

Amigo, the provider of so-called guarantor loans, is to list on the London stock market, valued at £1.3bn.

The valuation is based on the share offer price of 275p and will be listed on the London Stock Exchange on 4 July.

Founder James Benamor, 41, directors and employees stand to make £326.8m from the company set up two decades ago.

Mr Benamor has a net worth of £380m, according to The Sunday Times.

Borrowers with a bad credit history can take an Amigo loan from £500 to £10,000 with an average interest rate of 50%.

The rate compares favorably to payday lenders, who have been known to charge 5,000%, but it is a lot more than the 2.8% rate on an M&S Bank loan.

Loan repayments are guaranteed by friends and family.

Amigo’s business model has been criticised as guarantors may have a poor credit rating themselves. And some may feel coerced by the bonds of family and friendship.

Amigo chief executive Glen Crawford, who owns almost 10% of the company, said the share sale was a “significant milestone”.

“We look forward to further growth and success as a listed company and helping more people who need alternative finance.”

Amigo has a loan book of £647m and around 182,000 borrowers.

It made an adjusted profit before tax of £72m in the year to March, up from £46m two years earlier.



Source link

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.