The board of the company behind struggling subprime lender Amigo Loans has called on its founder not to push ahead with a series of proposals he made on Friday.
The board said that James Benamor should not “waste further time and expense” in calling a shareholder vote which could seriously shake up the way the company is run.
It has agreed with Glen Crawford, Amigo Holdings’ newly appointed chief executive, that he can leave the business if Mr Benamor calls and wins the vote.
On Friday, Mr Benamor suggested that the board should appoint him chief executive of Amigo Holdings, while putting Mr Crawford back in charge of its subsidiary, Amigo Loans.
He said the chief executive had a lot of work to do at the UK business, including replacing board members who, he charges, “mismanaged Amigo”.
In June, the founder said that he would sell his 61% stake in the lender after losing a fight to remove several of its directors.
Only around one vote out of 10 among independent shareholders was cast in favour of Mr Benamor and his company Richmond Group.
On Monday, the board said that Mr Crawford will not want to continue at Amigo “in any circumstances where Mr Benamor returns to Amigo’s governance structure in a position of influence”.
“Mr Crawford’s decision to return as CEO was predicated on the clear statement from Mr Benamor that he was selling down Richmond Group Limited’s controlling shareholding in Amigo to a position of zero,” it said to shareholders.
Amigo’s shares dropped by more than a quarter shortly after markets opened in London.
“Mr Crawford and the board are therefore equally aligned in their unanimous rejection of the views and proposals put forward by Mr Benamor on Friday evening,” it added.
“The board therefore urges Mr Benamor not to waste further time and expense for either Richmond Group or Amigo in seeking to bring his proposals to a shareholder vote.”