A US-based hedge fund has beefed up its stake in insurance group Quindell, which is being investigated by the Serious Fraud Office (SFO).
Beach Point Capital Management now has a five per cent stake in Quindell, after buying more than 420,000 shares in the company on 10 September. Beach Point, whose clients include large public and corporate pension funds and endowments, specialises in investing in distressed credit.
Quindell's business and accounting practices are the subject of an investigation by the Serious Fraud Office.
The Aim-listed company appointed a new chief executive Indro Mukerjee last month, following the departure of Robert Fielding. At the time, Mukerjee said he was aware of the challenges the company had been facing.
It's had a difficult 18 months since it was first targeted by US short-seller Gotham City Research in early 2014. Quindell later won a libel case against the group, but its troubles continued throughout the year. By the end of 2014, chairman and founder Rob Terry had resigned, as had its broker, Canaccord Genuity, while investor Fidelity halved its stake.
Since then Quindell has sold its professional services division, which accounted for 90 per cent of its business, to law firm Slater & Gordon. Following a revision of accounting policies, the company revealed a post-tax loss of £350m for 2014.
Shares in Quindell were down one per cent to 98.3p per share in mid-morning trade.