Tom Winnifrith BearCast 15 March - Quindell again

Comments

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   zeronegative

   15 March 2015, 07:22

   Systematic ramping for the last 2-3 weeks to boost the share price so that when PCW comes out and shows the true nature of the business, the shares only fall back to 60-70p.

   Two posters on the LSE

   Leonstrade – 700Mill offer – Betaville 2 days later – 700Mill Offer
   tom@hsg – 640Mill deal – Sunday Times 5 days later – 640Mill Offer

   Both articles written by same journalist. Interesting! I think we know his sources as both these bid amounts only appeared on the LSE.

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   JaySee

   15 March 2015, 07:29

   You are completely right of course, but I fear there might be a blood bath tomorrow morning. This is market manipulation at its worse, and a complete disgrace.

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   Forty Two

   15 March 2015, 09:02

   I have a business that I want to sell you and the “run-rate” revenues are let’s say £380m. It consists of a whiplash business that’s growing mid-single digits despite the efforts of government to choke it and an NIHL business that is the fastest growing thing you have ever seen, that the regulators haven’t touched – yet. I’m stinging insurers for NIHL damages at about £9,000k a pop. But I only take on strong cases: about 25% of the people who pass through my pop up “surgeries” and I discount the revs I recognise by 61% because I’m known to be very conservative about predicting what these mug insurers might pay me and I’m not sure I trust ‘em if I’m honest. At last count I had about 44,500 of these cases on the go and they are growing exponentially as I’m pretty good at what I do. So whereas I should have a minimum of £400m of accrued relating to this on my balance sheet I’ve only got about £290m including whiplash and medical etc (£278m at H1) and probably only about £200m in NIHL (up to £300m if you trust the Sunday Times). That might seem a lot compared to £380m of revs but hey, business is good. The insurance dorks will probably pay up in 12 to 18 months – they don’t half drag their heels despite being my treasured “customers” that I like to logo-brand on my presentations. Now in the interest of full disclosure I should say that I’ve booked another £50m or so in revenues related to NIHL for what I like to call “other receivables”. That’s where I’ve pinned claims on insurers where I’ve not done the work myself but “3rd parties” have provided the services. Note to self – I owe them about £30m in payables for this excellent work (I’d better pay them – some of these guys are real bruisers). So how much will you buy my business for? It’s about £130m pretty solid non NIHL revs then and if you strip out the pass-through 3rd party revs (though I reckon I can take a turn on that) you’ve £200m of revs (OK up to £300m if the venerable Sunday Times is to be believed – though they reckon collection might take 3 years mind) you can go and collect. They are a dead cert – I’m telling you. I’m guessing you will pay your usual 1x for the £130m revs – and I really could do with the cash so I’m totally up for that. What will you pay for the rest of my good work – the £200m? Am I hearing £510-£660m? Hey look I don’t wanna muck you around. Even the Sunday Times knows from its City sources that the £200m has no precedent of being collected, could even take up to three years to collect and might not be as solid as the £130m that you wanna pay your usual £1x revs for. But you wanna pay 2.6x to 3.3x just for shits and giggles even though I’m desperate to sell and you have an exclusive and Rob Terry was a seller at a fraction of that? Either it’s my lucky day or the Sunday Times has been fucked over by some share rampers!!!!

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   Chrissy Carrigan

   15 March 2015, 10:25

   Hi Tom,
   I totally agree – there is not a hope in hell the S&G will pay that much cash. I am convinced Ben Harrington woke up this morning and made up his whole story over a coffee – driven purely by the desire to increase traffic and discussion to the Sunday Times and the topic of Quindell. I feel sorry for all those individuals in twitterland and QPPSAG that are convinced Ben’s story has any credibility whatsoever. If they [Rampers & Longs] seriously consider “City sources” as anything other than opinion – then they blinded by their desires to make a fast buck and deserve what is coming!
   Cheers
   CC

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   AK47

   15 March 2015, 16:18

   This Sunday Times story is total and utter bollocks. Price will rise on Quindell. Another opportunity to get a short position :-)

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   alcira16247

   16 March 2015, 00:15

   Tom

   Great bearcast!

   Shrewd analysis on the latest Quindell twist. Something murky appears to be going on behind the scenes, the ramping is becoming almost pandemic. Its all going to end in tears, one feels. Going to be an interesting couple of weeks.

   As far as I can see there is only one person that really knows the true worth of Quindell and that’s the bloke who created the gruesome abortion!

   And as I can imagine him now, gin and tonic in hand, lounging back taking in the fantastic views over Lake Ontario, from his luxurious Toronto penthouse, a great big satisfied smirk on his face…….. having sold out @ 40 pence a share …. and knowing they weren’t worth a tenth of that! Around his feet, thousands of shards of ripped paper……. being the received begging letters from Steamy and associates!

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   Phil

   16 March 2015, 00:22

   The article in the Sunday Times seems a tad irresponsible to me. Firstly there isn’t a confirmed fact in it, and you would expect some kind of analysis as to what this would mean to Quindell, and the effects on S&G, there is nothing there at all.

   I don’t believe this article at all, and judging the share price movements of S&G on the Aussie market neither do the shareholders of S&G.

   Even if this article were true, and QLS did have this kind of potential for cash generation, it indicates that there is something else in the Quindell group portfolio that is burning cash at an unprecedented rate.

   It would also leave Quindell reliant on a business model bought from one of terry’s mates, at a multi million rate for a loss maker, and a replica of the TIG deal with Cosy.

   All in all, I see nothing to cause me to close my long running short, however I may get chance to make a hedge call, and pick up some value on the uptick, It may also give the chance to some of the habitual posters on the asylum boards chance to get out. Human nature being what it is, what’s the betting the most vitriolic Quenron diehards bail first.

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   zeronegative

   16 March 2015, 02:28

   Short-term bounce today – expect it to settle at 115p by the end of day as MMs have marked it up sharply to sucker in private investors.

   Next story due Wednesday if pattern is repeated this week.

   I think Ben added an extra zero to his bid. So the offer will be.

   50/50 profit on hearing cases – could make sense as they are an unknown at the moment.
   64Mill cash for rest of the QLS businesses

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   wildrides

   16 March 2015, 02:43

   I take my punishment like a man ……….. Ouch ….. aaaaah ……… Ouuuch …….. sob , snival , sob, sob ………..Muuuuum …..Muuuuum ……….. its not fair Mum .

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    Ben

    16 March 2015, 04:39

    I note that the RNS just released refers to the disposal of the PSD and a number of deal structures. The RNS does not make it clear whether the value quoted is an asset sale value or a share sale. In the asset sale scenario (ie the cases are sold) none of the liabilities pass to the acquirer. Therefore the value for shareholders will be significantly reduced.

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    Phil

    16 March 2015, 05:09

    Up pops the Quenron RNS, bang of schedule, city sources – yeah right.

    I seem to recall there is almost an unwritten rule than when two companies are talking to each other, they either say nothing, or issue a joint statement

    Lets wait & see if S&G respond