Towergate Financial Services denied being put into administration

The directors of Towergate invested £10m in the business earlier this year to help secure its refinancing, it has emerged this week.

The news follows the acquisition of Towergate Financial Services, the IFA business, by the parent group last week.

Towergate denied reports that it had been forced to put TFS into administration. It did appoint administrators Grant Thornton, but a spokesman said this was a technicality designed to ease the acquisition process. Market sources confirmed this was a common procedure.

Towergate is expected to roll Paymentshield, its mortgage protection business, into the parent group in the next two weeks. It acquired Paymentshield from the management in November 2006.

It is not expected to bring Open GI or CCV into the group. Towergate chairman Peter Cullum and chief executive Andy Homer have holdings in both companies.

Meanwhile, further details of the refinancing completed earlier this year have emerged. The directors put their own money into the company, as reports suggested they might. The debt was spread across more than 20 banks.