Shares in loan broker Loanmakers have been suspended from AIM (the London Stock Exchange's international market for smaller growing companies), after the firm failed to solve its funding problems.
Loanmakers, previously known as Debtmatters, has been badly hit by the credit crunch and although a new strategy last year saw it sell its IVA
book and pursue the previously lucrative debt
broking sector, market turmoil caused the company even more problems and on January 8, the firm said it was reviewing its funding options after trading remained poor.
Now the company has announced that things have not improved, and that it has been forced to suspend its shares.
"The Board announces that, further to the announcement of 8 January 2009, it has still not resolved its funding issues and therefore it has requested a suspension, with immediate effect, of trading of its shares on AIM, pending clarification of the Company's financial position," Loanmakers said in a statement.
Loanmakers was also badly hit in August 2008 when its chief secured loan
provider, FirstPlus – a subsidiary of Barclays, pulled out of the secured loan
market; the firm reported a £1.6m loss, on the back of a £6.8m loss for the year ending March 31 2008.
Late last year, the board proposed a £1.86million underwritten open offer but it was rejected by shareholders; had Loanmakers' shareholders accepted the offer it would have helped it cut its debts and raise enough working capital to continue trading.
© Fair Investment