UPDATE: IFX set to revoke takeover offer due to Argentex insolvency
Argentex Group PLC - London-based currency risk management firm - IFX (UK) Ltd, trading as IFX Payments, says it is consulting with the UK Takeover Panel about invoking the insolvency condition of its takeover offer for Argentex, which allows it to revoke the offer. The IFX announcement early Monday follows the decision by Argentex on Friday to appoint administrators for the company and subsidiaries. Argentex has applied to the court to have operating subsidiary Argentex LLP placed into special administration under UK payment and electronic money institution insolvency regulations.
Earlier Friday, Argentex said the UK Financial Conduct Authority had ordered Argentex LLP ‘to cease all regulated activity, to not register and onboard new customers, and to not open any new foreign exchange trades’. Under the ‘voluntary’ agreement, Argentex also must ‘take all reasonable steps to stop incoming payments from existing customers’.
This followed the FCA’s supervision of Argentex amid ‘liquidity pressures’ caused by currency market volatility. Argentex had until Tuesday last week to find additional funding by means of a secured revolving credit facility but was unable to do so. As a result, its shares were suspended from trading in London on Thursday. They had plummeted more than 90% since April, when Argentex revealed a sharp deterioration in its short-term liquidity position.
Back in June, Argentex shareholders approved the takeover offer from IFX, which was for 2.49 pence per share in cash. IFX also had provided Argentex with a £26.5 million revolving credit facility and a £10.5 million bridge loan.
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