Davenham in strategic review as shares leap

SMALL business asset-based lender Davenham is looking for buyers or extra finance for parts of the group.

The Manchester business, which has an office in Leeds, made the admission in a stock market statement issued in response to a sharp rise in its share price yesterday. The shares jumped more than 40% to 11p before closing at 10p.

The company said a strategic review of the group was underway and that a renegotiation of its banking facilities was likely to be required, as previously announced.

It added: “This review is underway, including the seeking of indicative expressions of interest in elements of the group (or in raising finance for them). It is too early to indicate what the outcome of this review (or of any renegotiation of the banking facilities) might be.”

The group, which provides loans of up to £5m to small and medium-sized companies, has had a turbulent year. Its shares have lost more than 90% of their value in the past 18 months and it has been forced to cut staff after racking up losses of £55m.