Tuesday, 27 January 2015

Aussie lawyers Slater & Gordon in exclusive talks to buy Quindell's legal services division - part 6

I just thought I would clarify a few things on the Quindell takeover situation following last week's shenanigans on Betaville.

I have had a few readers raise questions about the £15 million that I previously reported Slater & Gordon paid to enter into "exclusivity" to buy Quindell's legal services division.

I don't think I explained the "exclusivity" payment particularly well in my previous article so I am going to try to here (below). In fact, the £15 million isn't for "exclusivity" but for a small percentage of Quindell's legal book, mostly focussed on motor insurance.

I understand Quindell allowed Slater & Gordon to do due diligence on 4pc of the AIM-listed business's legal book after the Australian company approached Quindell about buying its legal services unit late last year.

Quindell granted Slater & Gordon access to a small percentage of the book so that the Australian company could come up with a valuation of the sample and the whole legal services unit.

Slater & Gordon then said the small percentage of the book is worth around £12 million, according to my sources. In return for £12 million, Quindell gave Slater & Gordon a period of exclusivity to due diligence on the rest of its legal services unit.

My sources tell me that if Slater & Gordon don't proceed with an offer for the whole of the legal services unit, it has already agreed to purchase a small percentage of the book for £12 million not including VAT. If you include VAT, that gets you to about £15 million.  

Moving on, I hear this situation is likely to get lively towards the end of the week, so keep an eye on Betaville.

Quindell and Slater & Gordon both declined to comment.


  1. If 4% of the Motor book is worth 15 Million, then the whole Motor book is worth 375 Million. However, QLS has a large number of Industrial Deafness cases proceeding as well, each one worth up to 9,000 Pounds. Is S&G going to purchase these? It would be cheaper for S&G to raise funds and buy out QLS in it's entirety. I think 900-1000 Million is the price that Quindell would accept, but S&G may be looking to part pay with their shares.

    There has been a notable reduction of short interest in the last few days,and rumours are swirling regarding an important announcement to be made on Monday 2nd February.

  2. This comment has been removed by the author.

  3. Slater and Gordons official response isn't positive at all