Quindell seeks solutions to perceived undervaluation

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The management of the British insurance claims processor Quindell has evidently lost patience with the valuation of its shares, to the point that it is looking to radical corporate solutions to address the apparent anomaly.

Chairman Rob Terry revealed obvious exasperation with the continuing languishing share price despite reporting results in line with best expectations and without going into more precise detail added: “The valuation will re-correct as we generate the cash or if it doesn’t then we have other options available to us such as demerging the technology divisions away from the outsourcing divisions as an example, and listing them separately.” He added that sale of some divisions is also an option.

Quindell has suffered from aggressive short-selling, with some investors querying its practice of recognising revenue before cash is received, but analysts generally agree that the share price does not reflect cash generation. It is understood that the company has received informal approaches for unspecified parts off the business, and analysts at Canaccord Genuity point out that the legal services division alone would be valued at more than the whole group is valued at the same level as its peers.

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