CPP in race to secure funding before March 31 (From York Press)

CPP in race to secure funding before March 31

10:20am Thursday 21st March 2013 in News By Julie Hayes, Business editor

YORK employer CPP’s shares plummeted by 62 per cent after it told shareholders it had not yet managed to secure new funding arrangements.

The insurer’s current debt arrangements with its banks expire on March 31, and the business said in a statement to the Stock Exchange that it was still in discussions with current lenders and considering alternative options, such as equity funding and asset-based lending.

CPP said in the statement to the Stock Exchange that the board continued to work on a number of financing solutions and to have constructive discussions with the group’s existing lenders.

It said no financing solution had yet been achieved and said: “It is clear to the board that there is significant uncertainty as to what value any such financing solutions may deliver to CPP’s ordinary shareholders, particularly given the current trading price of the ordinary shares.”

Stockbroker Chris Steward, of Redmayne-Bentley in York, said the announcement signalled more bad news for CPP following a number of lost contracts.

He said: “It says they’re in constructive discussions, but it does ultimately say they’ve not got anywhere to date.

Hugh Bayley, MP for York Central, said: “CPP is a viable business and with backing from its banks will continue to grow.

“It’s important to hundreds of people in York that CPP gets the backing it needs.”

Julian Sturdy, MP for York Outer said: “The biggest concern that I have is over job security and there will be a lot of ongoing concern about what the future holds. As local MPs we share their concern and will do everything we can to work with the company to try to safeguard the company’s future and also jobs within York.”