eFinancial News, London – U.K. subprime lender Cattles PLC Monday said it has sold its Cattles Invoice Finance Ltd. to London-based private-equity fund AnaCap Financial Partners LLP as Cattles looks to pay down its hefty bank debt.
The deal, which needs shareholder approval, would see AnaCap take over the division for around £10.4 million ($17.3 million) in cash and the repayment of around £59.6 million of intercompany loans.
Future funding for the division, which provides loans to small and medium-size businesses ranging from £25,000 to £4 million, will be provided by Lloyds TSB Commercial Finance, AnaCap added.
The sale proceeds are expected to repay £65.5 million of Cattles’ bank debt, Cattles said. Its shares have been suspended since April after it said it hadn’t been able to audit its 2008 accounts.
The company has a £500 million syndicated loan led by Royal Bank of Scotland Group PLC due at year end and a further £135 million loan due in December.
Cattles, which recently installed a new management team after it fired its six suspended senior executives following a forensic review into accounting errors and impairment provisions, said the sale is the best opportunity to get “an attractive and certain value” for the unit. The sale will also simplify its operations.
Source: eFinancialNews.com
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