Property investment platform, Wellesley, has had its CVA proposal approved.
94.7% of creditors backed the proposal. Now they have six weeks to decide if they want to take cash or preference shares as part of the CVA terms.
Just in Septemeber, action was taken to suspend all payments to its investors as it asked creditors for support on a company voluntary arrangement (CVA).
The CVA proposal was put forward to support a restructure of the company after facing liquidity issues, brought on by the unprecedented COVID-19. Its liquidity was also not helped by the changing regulatory environment which made it harder to raise funds via its listed bonds on Euronet Dublin.
A CVA allows for negotiations to be made with creditors regarding payments owed, often making repayment plans to lengthen the payback time of loans to around 3-5 years.
Andrew Turnball, company director, said it had been a difficult and stressful period but he is pleased the CVA has been approved.
”The outcome would have been much worse for investors if it hadn’t been approved.”
Wellesley started as a peer-to-peer lender in 2013 and moved into mini bonds. In May 2017 it put a halt on accepting any fresh money for its P2P product and then in 2019 it moved to focus to ISA-eligible listed bonds which supported property developments.