Quindell share price soars 29.6pc as hedge fund Toscafund ups stake
Insurance outsourcer Quindell saw it share price surge 29.6 per cent in trading yesterday after London-based hedge fund Toscafund increased its shareholding in the company.
The Martin Hughes-founded Toscafund splashed out on a further 1.9m Quindell shares, bringing its stake in the Hampshire-based company to more than five per cent.
It was the second bit of good news in as many weeks for the troubled Quindell. Last week, the firm announced it had entered into exclusive talks with an unnamed third party over the sale of part of its business.
Both will come as a much-needed respite for the firm after a disastrous year which saw its stock lose over 90 per cent in value and its market capital-isation plummet £2bn in a matter of months.
The company’s volatile share price tanked last month when founder Rob Terry offloaded 25m shares, following his resignation as chairman in November.
Only days previously, the firm had called in PwC to review its business and provide proof of its financial stability after it had become a target for short-selling hedge funds including one of the world’s largest alternative asset managers, Tiger Global.
Quindell’s troubles started in April after mysterious US short seller Gotham City published a dossier suggesting the UK firm had “magical… paper profits”. Quindell has since successfully sued for libel.
But the turmoil in the aftermath led to the resignation of not only Terry, but also the firm’s joint broker Canaccord Genuity and PR outfit Redleaf.