City Heavyweights To Join Quindell Revamp

A former finance director of Royal Mail (LSE: RMG.L - news) and one-time boss of Prudential (SES: K6S.SI - news) in the UK will this week join an attempt to rehabilitate the reputation of the controversial insurance claims outsourcer Quindell (LSE: QPP.L - news) .

Sky News has learnt that the company, which has seen its stock market valuation crash from a peak of £2.5bn amid doubts over its financial probity, will name Richard Rose, the chairman of online electrical goods retailer AO.com and cash-and-carry operator Booker Group (LSE: BOK.L - news) , as its new chairman.

Jim Sutcliffe, a former boss of the insurer Old Mutual and Prudential UK, is to become deputy chairman.

Banking sources said that Quindell also plans to name Marisa Cassoni, who was finance director of Royal Mail and John Lewis and who is now a director of the Skipton Building Society, as a consultant.

John Tomlins, a former colleague of Mr Sutcliffe, will also join in a consulting role.

The group of heavyweight appointments, which are likely to be announced on Monday, is intended to remove lingering market uncertainties about the state of Quindell’s finances and the robustness of its business model.

One of Mr Sutcliffe’s current roles is as chair of the codes and standards committee of the Financial Reporting Council, the accounting regulator, which one source suggested should reassure Quindell investors.

The announcement will come, however, amid an ongoing investigation led by PricewaterhouseCoopers into Quindell’s performance following months of turmoil at the company.

Quindell’s founder, Rob Terry, had promised to revolutionise the insurance industry by taking on a large chunk of its claims processing activities, but eventually quit the board late last year after a row over share deals involving himself and other directors.

David Currie, a former Investec (LSE: INVP.L - news) banker, stepped in to replace Mr Terry as chairman, and has been focused on addressing shareholders’ concerns about Quindell’s corporate governance.

Mr Rose’s appointment will mean that Mr Currie will step down as chairman, but he is expected to remain on the board as a non-executive director.

Earlier this month, Quindell said it was in exclusive talks about the sale of one of its divisions, while it is also engaged in discussions about transactions involving other parts of the group.

Quindell, whose financial affairs have become one of the City’s most notorious talking points, raised £200m from investors in 2013 in order to become a one-stop shop for car insurers.

It provides a range of services which help insurers assess and treat drivers and passengers, leading to the formation of a joint venture with the RAC (Taiwan OTC: 2237.TWO - news) , the roadside recovery service.

The partnership was hailed as the beginning of a far-reaching initiative that would involve installing more than 2m telematics black boxes in cars across the UK, but has since been scaled back to a far more limited project.

Quindell has faced persistent questions over the way it books revenues and its financial forecasts, which it has rebutted, but the sense of crisis surrounding it deepened in November, when Canaccord Genuity resigned as its joint corporate broker.

A replacement has yet to be appointed.

Quindell’s shares have plummeted by more than 70% in the last 12 months, although they made significant gains last week when it emerged that Toscafund, a prominent City investor, had acquired a 5% stake in the hope that its fortunes would improve.

The company, which is now valued at around £370m, declined to comment on Sunday.