Nvesta parent company Eurolife has survived the vote on the restructuring of the failed Eurolife Secured Bond, which was issued by special purpose company Eurolife Capital Funding. 78% of bond holders (3% more than the 75% minimum required) voted in favour of the proposal.
The company will now be able to unwind its business over what it considers to be a more realistic timeframe, and to rebuild value in structured products subsidiary Nvesta, as it prepares it for sale.
Under the terms of the restructuring, Eurolife has until 2008 to sell some or all of Nvesta. Various options have been mooted, including a management buy-out and selling part of the company immediately. What the company does not want to do, said Nvesta director Anthony Green, is to sell the whole of Nvesta on current depressed valuations. "It's really early stages," said Green. "But we know the position now and we are working on a strategy to regain market share and rebuild the company."
The restructuring proposal valued Nvesta at £630,000, down from its audited value of £4.5m in 2003.
Eurolife Secured Bond offered 6.5% income for five and a half years, or 40% growth, to over 2,000 investors. It was due to repay capital on 23 January. Nvesta was the administrator and Isa manager for the Isa wrapper which held the bond.
