Helphire, the UK's biggest credit hire company, has raised £19m through placing 26 million shares on the Stock Exchange this week.

The company lost £48.1m in the six months to September 2000, after the Dimond v Lovell court case, which made its credit hire contracts unenforceable.

But deputy chief executive Mike Jackson said the new funds were not needed to clear the subsequent debt incurred.

He remained tight-lipped about whether the £19m would be used to restructure the company.

Jackson said that Helphire has already reduced its overdraft from £50m last year to just £10m by making bulk settlements with most major insurers.

He dismissed reports that Helphire had sought as much as £40m of new funding. “We wanted £19m and that is exactly what we received,” he said.

And he added that the fundraising venture was met with a lot of enthusiasm from city fund managers and shareholders.

The credit hirer issued 26 million shares priced at 75p each, slightly less than Monday's price of 77p, to investors on the London Stock Exchange on Friday. The offer was underwritten by investment bank ING Barings.

Jackson said the company now had more than enough funds for its existing operations, and to grow further.

He added that Helphire had also received a boost from its membership of the Association of British Insurers' code on credit hire rates. “This new business model is very cash generative, since we now have claims settled within 28 days,” he said.