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Openwork shareholders offered preference shares in Zurich restructure

Zurich has increased its loan facility to Openwork from £18m to £30m and is offering the network’s advisers 30 per cent of preferential shares in a restructure of the firm’s funding.

This week, shareholders met at Birmingham Airport and 95 per cent voted for a restructure of the business that will see advisers given 30 per cent of preferential shares. Zurich previously held 100 per cent of preferential shares.

Shareholders will be unable to sell their stake unless there are two consecutive years of pre-tax profits, the second being at least £5m, and the purchaser pays over £75m. The firm hopes to complete the deal by the end of March.

Openwork made a pre-tax loss of £5.5m in 2010 compared with a £3.7m loss in 2009.

Openwork chief executive Martin Davies says: “In order to get through the RDR, we need to provide support for advisers.”

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