Quindell Capital Return

Quindell have put into the public domain all known bad news. I assume Quindell have been waiting for the dust to settle before they start releasing positive news.

This week we have had results from Slater and Gordon. These provided no bad news for Quindell and indicated  NIHL revenue expectations greater than predicted by QPP.

Next week we have the Quindell AGM.

Could the AGM be the start of the Quindell “good news campaign”?

One of the outstanding issues shareholders want to know, is how the £1+ capital return will be made to shareholders.

Is the route going to be a share buyback? This being the most likely scenario as provides the greatest incentive for the BOD for the following reasons:

1. BOD benefit without having to purchase additional shares.
2. BOD benefit as no restrictions due to closed period preventing them from buying shares.
3. Gradually buying back shares will reduce share price volatility and ensure maximum gains made by longterm shareholders.
4. Gradually increasing the share price by buying pack shares over a longer period will encourage Institutional Investors to invest. They will know share price should increase.
5. In the future, assuming the business is a success, on paper the improvement will look better than they are  in reality. This will enhance the reputations of the BOD.

At the AGM perhaps we will hopefully find out what the BOD’s intentions are with regard to the capital return.

Good luck to those who have decided to take a QPP short position. The tide has definitely turned in favour of longterm holders. Expect positive news to start flowing soon.


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