Business
Acquisition of FundingKnight
Acquisition of FundingKnight.
About this update from Sancus Lending Group Limited
[{"type":"text","content":"\n \nRNS Number : 5112C GLI Finance Limited 28 June 2016 \n\n28 June 2016\n \nGLI Finance Limited\n(\"GLI\" or the \"Company\")\n \nAcquisition of FundingKnight\n \nThe board of GLI announced in its strategic review update released on 16 February 2016 that it had not been possible to agree a way forward between GLI and FundingKnight, an online peer to peer lending platform. As a result, GLI became a passive investor with respect to its interests in Funding Knight Holdings Limited (\"FKH\"), the holding company for the FundingKnight group. These include a 23.4% interest in FKH's issued ordinary share capital with a carrying value of £2.481 million, a £1.001 million investment in FKH's preference share capital together with accrued interest of £0.290 million thereon and £0.525 million of loans provided by GLI to FKH. \nOn 28 June 2016, Greg Palfrey and Steve Adshead of Smith & Williamson LLP (\"S&W\") were appointed as administrators to FKH. The board of GLI is pleased to announce that, shortly after S&W's appointment, the Company agreed to acquire the respective entire issued share capitals of Funding Knight Limited (\"FundingKnight\", FKH's operating subsidiary) along with FKH's other subsidiaries, Funding Knight Services Limited and Funding Knight Corporate Services Limited, both of which are dormant (the \"Acquisition\"). Consideration of £0.75 million was paid in cash at completion of the Acquisition. As part of the terms of the Acquisition, GLI has also committed to provide Funding Knight with at least £1 million of further capital to finance its ongoing operations. \nFunding Knight recorded unaudited turnover and a post-tax loss of approximately £0.61 million and £1.17 million respectively in the financial year ended 31 March 2016. FundingKnight's unaudited net assets at 31 March 2016 were approximately £0.13 million. £0.45 million of the consideration for the Acquisition will be applied by S&W in partial settlement of the Company's loan to FKH. The remainder of GLI's interests in FKH will be written down to £nil in the Company's balance sheet.\nAndy Whelan, CEO of GLI said\n\"We believe FundingKnight is a fundamentally good business with strategic value. By acquiring the business at a low entry price, we will help secure the continued employment of the FundingKnight team and provide rea...