Resurrected Quindell back on junior market

The company is still under investigation by the Serious Fraud Office for its past accounting and business practices

Indro Mukerjee is the new CEO of Quindell, now rebranded as Watchstone Group

Shares in Quindell resumed trading on Aim yesterday after the scandal-struck insurance software firm, now known as Watchstone Group, rewarded long-suffering shareholders with a £414m payout.

The company, still under investigation by the Serious Fraud Office for its past accounting and business practices, shot up 99.5p, or 142 per cent, to 169.5p after a 1-for-10 share consolidation and a 90p-a-share return to investors.

The payout follows the £637m sale of its largest division to the Australian law firm Slater & Gordon, which itself is the subject of a regulatory inquiry.

Watchstone still faces legal action from small shareholders who nursed heavy losses as the share price plummeted following a string of scandals.

Its founder and then-chairman, Rob Terry, quit amid controversy last year after selling shares despite the company telling investors he had increased his stake.

The SFO inquiry emerged in August on the day of the long-awaited publication of Quindell’s annual results, which revealed a £238m loss in 2014 after it wrote down the value of its assets – including acquisitions made by Mr Terry – by £157m.

The broker Peel Hunt started coverage of the stock yesterday with a buy recommendation, calling the company “a changed proposition”, in the first research note on the company in almost a year.

Its analyst Andrew Shepherd-Brown said: “Although historical issues are relevant to assessing contingent liabilities, management has made rapid progress, the group is fully funded with £90m of cash and a further £55m in escrow, and investors can now look to the future.”