Non-Standard Finance PLC Proposed Recapitalisation & Directorate Change (7975Z)

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RNS Number : 7975Z

Non-Standard Finance PLC

18 May 2023

Non-Standard Finance plc

('Non-Standard Finance', 'NSF' or the 'Company')

Update on proposed recapitalisation ('Proposed Recapitalisation') and Directorate Change

(18 May 2023): Further to its announcement dated 17 March 2023 regarding the launch of the Scheme and Proposed Recapitalisation or Alternative Transaction (the "17 March RNS") and its announcement dated 14 April 2023 providing an update on the Proposed Recapitalisation, the Board of Non-Standard Finance announces that Alchemy, the Group's largest shareholder, has informed the Company that it is no longer willing, in the current environment, to participate in the equity raise under the Proposed Recapitalisation on the previously notified proposed terms. The Group continues to press ahead with the Scheme and both the Proposed Recapitalisation and the Alternative Transaction, but if the Scheme is successful, the Board now feels that the Alternative Transaction is a more likely outcome than the Proposed Recapitalisation.

The Alternative Transaction will involve the transfer of the Group's business to the secured lenders in exchange for the release of a portion of their secured debt and the provision of a new lending facility. Part of the proceeds from this new lending facility would be used to fund the Scheme Fund and cover the costs of the Scheme.

Both the Alternative Transaction and the Proposed Recapitalisation will secure the future of the Everyday Loans business and allow it to pursue its growth plans providing an invaluable service for its customers. However, the Proposed Recapitalisation will materially dilute the interests of NSF's existing shareholders, most likely to negligible value, unless they choose to participate in the equity raise, and the Alternative Transaction will unfortunately result in no recovery for NSF's shareholders. The Board is continuing to consider a range of options for the NSF plc ultimate parent company in the event the Alternative Transaction is implemented, but the most likely outcome is an orderly winddown following implementation of the Alternative Transaction. In the event that the Scheme is not sanctioned by the Court, or the Scheme is sanctioned but the Proposed Recapitalisation and the Alternative Transaction both fail, then the Group would remain insolvent and the most likely outcome would be a Group-wide insolvency (most likely administration), also resulting in no return for current shareholders.

Following the communication from Alchemy regarding its position, Toby Westcott, the Alchemy nominee non-executive director of the Company, has stepped down as a director of the Company with immediate effect.

Unless otherwise defined, capitalised terms within this announcement shall have the same meaning as those contained within the 17 March RNS.

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018. The person responsible for arranging the release of this announcement on behalf of Non-Standard Finance plc is Sarah Day, Chief ESG Officer and Group Company Secretary.

For more information:

 
 Non-Standard Finance plc                 [phone] 
 Jono Gillespie, Group Chief Executive 
  Officer 
 Sarah Day, Chief ESG Officer and 
  Company Secretary 
 Cenkos Securities plc                    [phone] 
 Nicholas Wells 
 Ben Jeynes 
 Callum Davidson 
 H/Advisors Maitland                      [phone] 
 Neil Bennett                             [phone] 
 Finlay Donaldson                         [phone] 
 

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May 18, 2023 02:00 ET (06:00 GMT)