The issue of the RNS (see here) today regarding the ongoing negotiations with Slater and Gordon contained the following salient points.
1. Exclusivity period relating to the possible disposal of the professional services division extended to 31 March 2015.
2. Terms being discussed would imply a significant premium to the Company’s market capitalisation at the close of trading on 20 February 2015.
What can also be deduced from this announcement is:
1. This is not a fire sale. If it was the figures being discussed would not be at a significant premium to the Company’s market capitalisation.
2. If cash was an issue the exclusivity period would not have been extended. It would have been concluded asap.
3. Puts to bed the ridiculous idea the company is worth 0p.
It is also worth noting the extended exclusivity deal does not mean we will be waiting until the 31st March 2015 before an announcement is released regarding the deal structure.
Detractors are highlighting that SGH might have delayed their offer awaiting the release of the PwC review.
This is highly unlikely for the following reasons:
a) PwC have been working in the review for months and the results will already be known. SGH as part of their due diligence will be aware of the contents.
b) Quindell have never said they are going to release the PwC review. See here why PwC review contents will probably not be made public.
c) PwC review does not indicate that accruals and goodwill will have been wiped out as claimed by one detractor. If this was the case Quindell would have informed the market immediately.