The chairman of Quindell, Rob Terry, will be stepping down just days after a share-dealing controversy that caused Quindell’s stock to sink to a three-year low.
Rob Terry will be replaced by David Currie as interim Chairman, he was a former banker at Investec who was appointed to the Quindell board in July.
In addition, Steve Scott, who has been on the board for over five years, will step down along with Laurence Moorse, finance director – although he will be leaving after next year’s annual meeting.
The reason behind these three board members leaving is that they bought shares with a loan secured against their pre-existing stakes.
And on Monday it was revealed that they had actually received £8.8m from the US firm Equities First Holding in a sale and repurchase agreement – essentially meaning they were selling shares to raise funds and buy more stock.
When investors found out about this controversial share deal, which involved selling more shares than bought, Quindell’s stock took a nosedive.
A year ago Quindell raised £200m from investors and it promised to “revolutionise the insurance industry” through a one-stop shop for car insurers. It went on to form a joint venture with the roadside recovery service, RAC.
At the beginning the partnership was thought to lead to a large scale project that would involve installing over 2m telematics black boxes across cars in the UK, but now it’s been scaled down significantly.
Quindell’s shares closed at 55.5p on Monday, representing a market value of around £300m – far lower than its peak value of £2.5bn.
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