The Slater and Gordon Quindell RNS is out and contains some very positive messages and information for shareholders, See Here.
The following are some of the key messages from the RNS:
1) A minimum of £500m is being returned to investors. My understanding is after discussions with major shareholders, due to the tax implications this will not be in the form of a special dividend.
This could be via a share buy back.
2) No tax will be payable by Quindell associated with the sale due to ‘major shareholder exclusion’.
3) Quindell are using part of the proceeds to pay their £47m debt. Therefore Quindell will be a debt free business.
4) Revisions to historical profit levels due to alternative accounting process being adopted, as recommended by PwC, will result in a tax rebate.
5) Non core elements of the business being sold and revenue being returned to shareholders.
6) Rose and Sutcliffe as per their previous announcement are not taking up their option entitlements.
7) Future revenues from NIHL being returned to shareholders.
8) PwC review hasn’t uncovered accounting irregularities. The RNS states policies recognising revenue and deferring case acquisition costs, aggressive, but acceptable practice.
The message is clear, Rose and Sutcliffe are;
a) returning value to shareholders
b) streamlining the business