Erinaceous revealed today that it has held emergency talks with its lenders over breaches of its banking covenants.
In a statement to the Stock Exchange this morning, Erinaceous said: ‘Following recent press speculation, the Board of Erinaceous confirms that it is in discussions with its lenders regarding the terms of its credit facilities and certain breaches of the covenants in its credit agreement.
‘Good progress towards reaching agreement with lenders on relevant waivers and facility amendments has been made. Discussions are continuing, the lenders have been supportive and the board intends to obtain proposed amendments prior to the issue of the company's interim results due to be released on 25 September, 2007.’
Erinaceous shares dropped 30% to 77p when the Stock Exchange opened this morning.
The company also said that it may delay the announcement of its interim results, which has already been pushed back once.
Reports also emerged this week that Fursa, a hedge fund that holds about 6% of Erinaceous, is pushing for an extraordinary meeting to remove chief executive Neil Bellis (pictured) and finance director Michael Pearson. It is thought that Fursa has the backing of around 40% of shareholders.