Yahoo Finance Scandal-hit Watchstone reveals plan to break itself up
The company behind the Quindell stock market scandal is set to disappear after it revealed plans to break itself up and the executive brought in to turn it around announced his departure.
Watchstone, as Quindell is now called, said that “all remaining businesses will be prepared for divestment” and that Indro Mukerjee, who took the helm less than two years ago, planned to leave at the end of 2017.
Its different divisions will have their “own dedicated management team” and will “be shaped to operate more autonomously”, the supplier of technology to the insurance and healthcare industries said. Mr Mukerjee said sales, mergers, demergers and initial public offerings will all be considered, to realise the value of the different businesses.
“This will signify the end of my work with the group,” the chief executive added.
Quindell was once a darling of London’s junior Aim market but was plunged into turmoil in August 2015 when it revealed its previous management team had overstated its past results, and it had been loss-making when it had said it was profitable.
It remains overshadowed by its troubled past: A Serious Fraud Office investigation into the results restatements remains ongoing and Watchstone is also being sued by Slater & Gordon, the Australian law firm that acquired its legal business in a £637m deal which has since proved disastrous for the buyer.
Watchstone’s founder and former chairman Rob Terry left the business in September 2014 after he and two other directors became embroiled in a share-dealing controversy.
Richard Rose, Mr Terry’s successor, said that “although timing is beyond our control for most of our legacy matters, it is disappointing we have not yet definitively resolved a number of these issues facing the group”.
The plan to break-up the company came as Watchstone posted a pre-tax loss of £18.9m for 2016, compared with a £177.7m loss a year earlier. Revenues rose by 8.5pc to £60.7m.
Watchstone shares were down 0.51pc at 147.75p.
