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Amigo Holdings PLC (LON:AMGO) shares rose on Friday despite the loan guarantor releasing a shocking set of results, as founder James Benamor pushed ahead with plans to re-take control of the guaranteed loans specialist.

Benamor’s vehicle, the Richmond Group, has requisitioned a meeting to remove its senior directors and put forward resolutions that will reinstate him as a director and remove finance head Nayan Kisnadwala, chairman Roger Lovering and chief executive Glen Crawford. Other resolutions involve the Amigo Loans subsidiary.

In a blog post on Thursday, Benamor said he will buy 29% of Amigo’s shares at any price up to 20p per share if shareholders back his bid to be appointed to the Amigo board and take over as chief executive officer.

Richmond held a 61% stake in Amigo at the start of June but vowed to sell 1% of that every day while the current board remained in place.

As of Thursday, Richmond’s notifiable interest had dropped to 10.7%, though who has been buying the shares is not clear.

Rise in bad debts

First-quarter results released on Friday by Amigo indicated a sharp rise in bad debts due to a more gloomy assessment of the prospects for customers in the aftermath of coronavirus.

Amigo has also been battling with a surge in complaints from borrowers and has set aside £116mln for the potential costs, although this provision did not rise in the latest quarter to June 2020.

The loan book dropped by 24% to £553mln from a year earlier, with revenues down by a third to £48mln.

Amigo said the impairment or bad debt charge went up to £18.5mln or 37.9% of revenues and profits for the quarter tumbled to £1.4mln from £22.6mln.

Nayan Kisnadwala, CFO, said: “Operationally we have turned a corner in our handling of complaints. We are on track to meet the agreement reached with the FCA to resolve our complaints backlog and continue to work with the FCA on its ongoing investigation.

“We have adequate liquidity and funding to support our ongoing business activity.”

The shares were up 10% to 13.18p by late afternoon on Friday, though 80% lower than at the start of the year.