Bank of Scotland, part of the Lloyds Banking Group, has agreed to take just under a 20% stake in Midas Capital after the fund manager was forced to renegotiate its £36.5m debt.
Subject to shareholder approval, the restructuring will see £10.5m of the £36.5m owed to Bank of Scotland converted into ordinary shares and warrants in Midas, representing 19.99% of the company's issued ordinary share capital.
A further £14m will be converted into cumulative redeemable preference shares and £12m will be put into a new senior debt facility.
In order to retain and attract key employees, Midas also intends to put in place a management incentive scheme comprising nil-cost ordinary shares, options and/or warrants representing 15% of the ordinary share capital in issue immediately after the restructuring has been completed.
Furthermore, group CEO Simon Edwards will step down from the board and will focus solely on the Midas fund management activities based in Liverpool.IFAonline
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