Quindell PLC Sinks As Broker Canaccord Resigns

Beleaguered Quindell PLC (LON:QPP) is hammered again after news its broker Canaccord Genuity has resigned.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Things just go from bad to worse for beleaguered Quindell (LSE: QPP). The AIM-listed company released a terse RNS this morning:

“Quindell Plc (AIM: QPP.L), a market leading global provider of professional services and digital solutions, announces that Canaccord Genuity Limited submitted its one month notice of resignation as the Company’s financial adviser and joint broker on 21 October 2014 but that the Company has agreed that the resignation is effective today”.

Canaccord had been hired by Quindell in July last year to work alongside the company’s existing nominated financial adviser (Nomad) Cenkos Securities.

The relationship hasn’t been particularly fruitful. In particular, Quindell suffered a major embarrassment in June this year when its application to move from AIM to London’s Main Market was rejected by the UK Listing Authority for reasons that have never been fully explained.

Quindell has regularly been accused of making less than full and transparent announcements — signed off by its Nomads. Indeed, today’s announcement itself has raised eyebrows. If Canaccord resigned on 21 October, why has it taken Quindell until now to inform the market?

Scandal

The Nomad system is the primary way the AIM market regulates companies. The role of a Nomad is “advising and guiding an AIM company on its responsibilities under the AIM Rules”. If a company loses its Nomad, for whatever reason, the company’s shares are suspended, and the company has just one month to find a new Nomad or face being de-listed.

The resignation of Canaccord leaves Quindell still with a Nomad in the shape of Cenkos, but Cenkos is in the midst of a scandal over controversial “loan facilities” entered into by directors at Quindell — and a number of other AIM companies — with a US firm called Equities First Holdings LLC (EFH).

Quindell’s first announcement regarding EFH, on 5 November, signed off by Cenkos, was particularly opaque. Cenkos subsequently issued a non-regulatory note, purporting to clarify the nature of the deal between three Quindell directors and EFH, which also proved to be misleading. And a further clarifying — regulatory — announcement was put out last week by Quindell … which still doesn’t fully clarify matters.

Will Cenkos follow Canaccord?

There looks to be a risk of Cenkos also being fired or resigning, leaving Quindell in need of a new Nomad. The trouble is, it’s hard to see Quindell finding one. The company has become a hot potato with the latest shenanigans following on from a scathing attack on the company by US shorting outfit Gotham City Research in April and, more recently, allegations of fraud by UK blogger Tom Winnifrith, against whom Quindell says it will be taking legal action.

Quindell’s shares have been in decline since reaching a high of 660p last February. They’ve taken another hit this morning, and are trading at just 60p at the time of writing.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

G A Chester has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

6 stocks that Fools have been buying!

Our Foolish freelancers are putting their money where their mouths are and buying these stocks in recent weeks.

Read more »

Google office headquarters
Investing Articles

1 reason I like buying S&P 500 shares – and 1 reason I don’t

Will this investor try to improve his potential returns by focusing more on S&P 500 shares instead of British ones?…

Read more »

Young woman holding up three fingers
Investing Articles

3 SIPP mistakes to avoid

Our writer explains a trio of potentially costly errors he tries to avoid making when investing his SIPP, on an…

Read more »

Smiling white woman holding iPhone with Airpods in ear
Investing Articles

Here’s how (and why) I’d start buying shares with £25 a week

Our writer uses his investment experience and current approach to explain how he would start buying shares on a limited…

Read more »

Aerial shot showing an aircraft shadow flying over an idyllic beach
Investing Articles

Here’s my 5-step approach to earning passive income of £500 a month

Christopher Ruane explains the handful of steps he uses to target hundreds of pounds in passive income each month.

Read more »

Investing Articles

2 UK shares I’ve been buying this week

From a value perspective, UK shares look attractive. But two in particular have been attracting Stephen Wright’s attention over the…

Read more »

Investing Articles

A lifelong second income for just £10 a week? Here’s how!

With a simple, structured approach to buying blue-chip dividend shares at attractive prices, our writer's building a second income for…

Read more »

Investing Articles

Here’s how I’d use a £20k Stocks and Shares ISA to help build generational wealth

Discover how our writer would aim to turn a £20k Stocks and Shares ISA into a sizeable nest egg by…

Read more »