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Amigo Loans founder fails to secure board comeback

James Benamor
James Benamor

Shareholders of Amigo Loans have rejected attempts by the founder of the embattled lender to force a return to its board and oust key personnel in a closely contested shareholder vote.

Just over 57pc of investors sided with management by opposing James Benamor’s attempt to reclaim control of the firm he founded in 2005 and floated with a £1.3bn valuation in 2018.

Shareholders also voted down proposals to oust Roger Lovering, the lender’s interim chairman, and finance boss Nayan Kisnadwala by a similar margin.

The result ends Mr Benamor’s second attempt this year to overthrow the existing management and reclaim control of the ailing lender.

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Mr Benamor believes Amigo failed to adapt to tougher regulation resulting in a nine-figure customer compensation bill.

Following the result, Mr Benamor tweeted: “Whilst we didn’t win, shareholders have sent a strong message today: ‘Protect shareholder interests, cut costs, rebuild value fast, or you will be replaced with a capable team.’”

Markets hub - Amigo
Markets hub - Amigo

The resignation of chief executive-in-waiting Glen Crawford last week after a disagreement with Amigo’s board was seen as yet another a blow to the firm.

Amigo confirmed that Gary Jennison would immediately take up duties as chief executive pending permanent authorisation by the City regulator.

Mr Benamor said: “Gary has been voted in by a (slim) majority of shareholders today. We should give him the benefit of the doubt and allow him to show us what he can do.”

Amigo noted that “a not insignificant minority of shareholders” voted against its directors. The company reiterated its commitment to its existing strategy but promised to “continue to engage with shareholders to understand their views”.

Amigo lends up to £10,000 to customers with poor credit ratings if a friend or family member agrees to step in if they fail to repay.

The firm, which has almost 200,000 customers, said that at the end of August 41,000 customers were on Covid-related payment holidays while 9,000 had resumed making full payments and 3,000 had paid off their debts.

Cash collection was running at 80pc of pre-Covid levels, the company said, adding that it was sitting on a £145m cash pile and had reduced its own net debt by £29m in July and August.

Shares fell 13.2pc to 10.4p in afternoon trading, valuing the firm at £48m.