A couple of observations, not necessarily mine, so I'd be grateful for either argument or support:
1. Slaters could cut off the UK business and the Australian business would service the debt by itself.
Slaters is as busy as ever in Australia and employees are very happy and confident. In fact, like many employees, they are enjoying watching their big big bosses squirm,
2. The class action by MBs is not only a joke but MBs would have a serious conflict in actually running it. As MBs would benefit with the collapse of Slaters, even though their and claimants interests might align, there is also a possibility they will diverge.
What if the claimants wanted to settle but it is in MBs interests to continue? What if there is a very limited prospect of success but it might be in MBs interests to proceed?
MBs have probably got all the value they can out of a class action by getting a run in the press but if they continue from here, if they can even, they are going to look pretty silly,
3. With foresight, when the problems with Quindell began Grech should have completely disowned the UK business at that point. He should have said in June, look there are problems here, I've made a mistake buying it but we are going to write it down to zero now.
All of the ensuing problems like proposed changes to UK laws, profit downgrades and deteriorating lack of trust in the board would have been avoided.
The price would have crashed but probably not as much as it did and certainly not crashed three times.
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I'm particularly interested about Australia being able to service the debt by itself. If so, the business survives in the short term, in the medium term generates massive income and further any income from UK is a bonus.
If this is the case, the share price has to be massively undervalued now.
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