GLI Finance share price soars as it secures backing for restructure

GLI Finance’s share price has hit a five-month high after shareholders backed proposals to refinance and restructure the business.

The AIM-listed alternative finance group had last month sought backing for a share fundraising and bond issue to recapitalise the company.

It is the latest overhaul since 2017 when GLI launched Sancus BMS to manage and rename the Platform Black and Funding Knight P2P brands, among other brands in its portfolio.

GLI Finance also invests in fintech firms through its Fintech Ventures portfolio but it will now focus on its property-backed lending through Sancus BMS, which it said was the only part of its group with “tangible value.”

The fundraising and bond issue were backed by shareholders at a meeting on Friday (4 December) where they agreed to raise up to £4m of new equity and refinance existing bonds by issuing up to £15m of new debt.

Both of these proposals are to be supported financially by GLI’s largest shareholder, Somerston Group.

The news sent GLI’s shares up five per cent to £2.75, the highest level since July.

As a result, 177m new GLI shares began trading this morning (7 December).

GLI also secured an extension of its financing facility from the Honeycomb Investment Trust, which will now expire on 28 January 2024 and be increased to £75m.

The development is a boost for GLI and its shareholders especially as other alternative finance firms have fared differently during the pandemic.

Wellesley entered a company voluntary arrangement to reduce its debts while others such as Growth Street are approaching wind-down, Lending Works has paused new lending and RateSetter got acquired by Metro Bank.

All GLI now has to worry about is choosing a new name for its restructured business.

Read more: GLI Finance narrows losses