Amigo Loans hires JP Morgan and RBC to prepare 500 million pound London IPO

By Ben Martin

LONDON, Feb 27 (Reuters) - British subprime lender Amigo Loans is preparing for a stock market float in London that could value the consumer credit firm at more than $700 million.

The company, which offers high interest loans and focuses on borrowers who have weak credit histories, has hired JPMorgan (LSE: JPIU.L - news) and RBC Capital Markets to examine the potential flotation, according to a person with knowledge of the matter.

Amigo would seek a market capitalization of over 500 million pounds ($695 million) from a listing, the person said.

The Bournemouth-based firm issues loans that are usually guaranteed by a borrower's family or friends.

Glen Crawford, its chief executive, said almost two years ago that a listing in London was a major plank of the company's strategy. In a presentation to bond investors published earlier this month, the group said it was exploring a potential initial public offering.

If Amigo presses ahead with a flotation, it would join a host of other financial services firms that are eying stock market debuts on the London Stock Exchange (Other OTC: LDNXF - news) .

They include Cabot Credit Management, which is Britain's biggest debt collector, as well as peer-to-peer lender Funding Circle, and IntegraFin, operator of the Transact platform used by independent financial advisers.

Amigo is controlled by Richmond Group, which was founded 18 years ago as a loan brokerage by entrepreneur James Benamor, who was then just 21.

Benamor's Richmond is now a holding company for a variety of other investments, including rental firm Let Me Property, although Amigo remains its main business.

For the nine months through December, Amigo reported a 42 percent jump in adjusted earnings before interest, taxes, depreciation and amortization from a year earlier to 84.6 million pounds. It had a net loan book of 607 million pounds at the close of 2017. ($1 = 0.7195 pounds) (Reporting by Ben Martin; Editing by Susan Fenton)