SHARES in the embattled insurance outsourcer Quindell surged yesterday, closing up 22 per cent on the news its board was due to recommend a £640m takeover offer.
The offer from law firm Slater & Gordon marks a reversal of fortunes for investors who have seen their shares pummelled since a report by short-seller Gotham City, which the company disputed and over which it won a libel action.
Business secretary Vince Cable recently wrote to the Financial Conduct Authority calling on the regulator to investigate allegations of “potential market abuse” regarding the situation.
Quindell’s problems were exacerbated by the resignation of chairman and founder Rob Terry last November and Fidelity’s decision to halve its stake in the ailing firm.
The £640m offer price is a coup for the board and investors as it represents £100m more than Quindell’s current market value.