Alternative business structure Quindell plc has had to shelve its much-trumpeted plans for a full listing on the London Stock Exchange, the company admitted today.
The news has further hit the AIM-listed company’s share price, which has still to recover from a shorting attack in April. At the time of writing, shares were trading at 15.5p, 2p down on last night’s close, and around 25p from their April high.
In a statement, Quindell said it had been advised that its rapid growth over recent years means it is unable to satisfy Listing Rule 6.1.3 at this time, and particularly the criteria in guidance note 6.1.3E(5). This states that an applicant may not be eligible if its business has undergone a significant change in its scale or operations during the period of the historical financial information, being the last three years’ audited accounts.
Quindell said it continued to believe that the main market is the “optimum UK market for the company and will continue to seek a listing on this market as soon as practicable. The company will also continue to explore other options, including listing in North America”.
Rob Terry, the founder and executive chairman of Quindell, said: “Firstly, I would like to take this opportunity to apologise to shareholders, who will no doubt be as disappointed as the board are at hearing this news.
“This is in no way reflective of the success of fundamental performance of the business. Quindell’s relationships with customers and partners remain exceptionally positive, with a number of initiatives being undertaken in new territories and relationships in existing territories continuing to expand.
“Our outsourcing services division continues to grow and perform extremely well with our planned improvements to operating cash flow remaining on track. The long-term growth potential of telematics for the group’s solutions division continues to exceed our expectations with a significant number of new clients now live and the percentage of consumers opting for a telematics solution, when available, in North America significantly exceeding our previous guidance.
“Regrettably it is Quindell’s success and change of scale of its operations during the last three years that is a core reason for the group not being deemed to be eligible for a premium listing at this time.
“Quindell has significantly expanded its business into new areas of opportunity, which has resulted in a business employing over 4,000 people today globally and has organically created approaching 1,500 jobs in the UK, making Quindell one of the largest employers in a number of areas of the country.”