Quindell share price edges up as investors vote in favour of Slater & Gordon deal
Quindell shareholders have voted overwhelmingly in favour of a deal to sell its professional services arm to Australian law firm Slater & Gordon, with 99.1 per cent in favour of the deal.
Shares in the company rose 1.3 per cent to 133p after the vote, which took place at an extraordinary general meeting held in Southampton today.
After several weeks of negotiations, last month Quindell announced plans to sell the division, which accounts for around 90 per cent of the company, for £637m in cash.
On Wednesday Rob Terry, Quindell's founder and former chairman who stepped down during the height of the company's annus horribilis in 2014, published a blog on the site of his investment vehicle, Quob Park Estate (which, incidentally, has an almost identical logo to Quindell, and has bought 10 per cent of the company), suggesting the deal undervalued Quindell.
[The deal is] based on a circa 7 x PE of the Road Traffic Accident related work of Quindell while Slater and Gordon trades on circa 21x PE.
Incidentally Quindell itself should have been able to attract a similar multiple and would have meant that those assets being sold alone would have effectively supported the total peak valuation of Quindell of £2.4 billion, even without the upside from Noise Induced Hearing Loss work.
Terry stepped down in November after shares in the company fell more than 90 per cent in eight months. In April, the company was accused of having "magical… paper profits" by mysterious short-seller Gotham City Research last year. The allegations caused shares to plummet, ending the year at 42p, less than a tenth of the 520p peak it hit in April.