Morgan Stanley’s Quindell hokey cokey – you put your money in, then take it out
Stock exchange: reporting thresholds
Morgan Stanley has dumped Quindell stock just four days after becoming the alternative business structure’s second largest shareholder, it has emerged.
Quindell’s shares jumped on Monday after announcing that Morgan Stanley had taken a 5.03% stake in the business, but after yesterday’s close another announcement revealed that Morgan Stanley’s stake is now below 3% and any disclosure requirements.
There is a delay in making these announcements, so Morgan Stanley actually bought last Thursday, 12 February, and sold on Monday.
Morgan Stanley’s entry had also improved the tenor of the chatter around Quindell, with the Daily Mail reporting that it was a sign of the company’s “revival… gathering pace”.
Despite the sudden sale, Quindell’s share price has been largely unaffected today, down just 1% to 72.25p at the time of writing.
Hedge fund Toscafund, which tipped over the 5% mark last month, last week sold 2m shares to take it below that reporting threshold.
Financial website Motley Fool suggested that “both trades highlight the reality that institutional investors are not buying into Quindell ahead of the publication of the PwC report into the firm’s accounting practices, which is due at the end of February”.
“Until then, I believe Quindell is far too speculative to invest in and remains a sell: even if the firm’s business does turn out to be healthy, I believe there are too many questions about the value of its assets and its funding situation for it to be a safe investment.”
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