STRICKEN specialist lender Cattles said it was considering de-listing from the stock market – in a move which would leave investors with just 1p a share.
The Birstall-based firm is looking to form a new company and take the business private as part of a financial restructuring to recoup money for creditors.
Investors have already been braced for bad news.
In a statement, executive chairman Margaret Young said Cattles did “not expect any payment to shareholders to exceed 1p per share” if the plan goes ahead.
About 80% of its shareholders are retail investors such as former and current staff.
De-listing would free Cattles from the regulatory requirements of being listed on the stock market.
Cattles is winding down its Welcome Finance loan book to pay back creditors after failing to secure a restructuring agreement with them.
It has been working with its lenders, including the part-nationalised Royal Bank of Scotland, for many months to agree a restructuring of the wider business.
While Cattles has admitted the value of the firm’s assets are far less than money owed, creditors are said to be reluctant to put the firm into administration as it would make it harder to collect money.
Instead, the firm plans to collect outstanding personal and second-hand car loans over a two-to-three year wind down period. It still employs about 3,000 staff across the UK to help collect the cash.
Cattles has been labouring under £2.7bn in debts and was also hit by accounting irregularities.
The group, which lends to people with impaired credit histories, released long-delayed results late last year for the nine months to September 2009 showing a pre-tax loss of £347.4m.
It also revealed a loss of £555.3m for 2008 due to impairment charges on bad loans of £778.9m.
Cattles has been listed since the 1960s and counts many former staff among its shareholders due to popular past employee share schemes. Cattles would need 75% investor approval for the de-listing plan to go ahead.
