So we started the week by closing out our trade in to Amigo Plc the shares are listed on the London Stock Exchange at the moment, but they could get delisted. We bought in at 16p on Monday and then again on Tuesday at 20p per share. The rational being that a decision on the scheme of arrangement would be very positive (40p target) and that decision was imminent. There was no guarantee that the scheme would be approved, but creditors voted in favour and it offered a greater likelihood of a good outcome for claimants as opposed to the chance of insolvency.

On Wednesday morning the court came out with a decision to not sanction the scheme of arrangement, the result was a drop in the share price of 50%, from 20p to 9p. The decision was taken to sell out. If a decision is taken to appeal that should be positive to the share price, but there is no guarantee that will occur, nor can timing be foreseen.

– So if Amigo puts in an appeal I’ll probably buy back in.
– If it doesn’t appeal then the equity is worth 0

Another alternative is to purchase the Amigo bonds, which at c. 80% could be par in both an insolvency and scheme procedure.