Lendy administrator seeks nominations for M2 lenders committee
Lendy’s administrator is seeking nominations for membership of a new ‘M2’ committee of lenders, to help deal with the recovery of funds.
Lendy investors are split into two groups: model 1 (M1) and model 2 (M2), which impacts how they receive funds recovered from the collapsed peer-to-peer lender.
M1 investors are defined as creditors, meaning their eventual payouts will be pooled with other creditors, while M2 are defined as investors, which means that they may be able to recover funds directly from the loans that they helped to fund.
The Lendy Action Group (LAG) won its case against administrator RSM in August 2021, meaning that M2 investors are being given priority in distribution payments.
“In the period since the judgment was handed down the joint administrators have been working with their legal advisors and Gunnercooke, who represent the LAG to agree an appropriate way to deal with the applicable costs and expenses which Lendy has incurred in collecting and realising the M2 loans,” RSM said in a letter to Lendy investors.
“This was agreed as a cost protocol in the form of a court order which was approved by the court on 20 July 2023.
In accordance with the protocol, RSM is seeking nominations for membership of an M2 committee.
It said that there must be between three and five M2 lenders represented on the committee, one of whom will be LAG spokesperson Lisa Taylor.
If more than four eligible candidates apply to become M2 committee members in addition to Taylor, M2 lenders will be asked to vote on which candidates are to be appointed.
Interested candidates must be an M2 lender, be owed money in respect of an M2 loan, must not be a member of the company’s creditors committee and must sign a non-disclosure agreement.
Lendy fell into administration in 2019, with more than £160m outstanding on its loanbook and at least £90m of those funds in default.
RSM has extended the administration process until 23 May 2025 and says that it is unable to ascertain when it will end.
It has now racked up £5.89m in fees, as of 23 May 2023.