A long-running dispute between insurance services firm Watchstone Group PLC (LON:WTG) and Anglo-Aussie lawyers Slater & Gordon finally came to an end this week, bookending an acrimonious tit-for-tat exchange between the two companies.
The parties agreed a settlement on Monday just hours before a High Court hearing was due to start regarding a fraud lawsuit filed by Slater in 2017 against Watchstone, then known as Quindell, over its disastrous acquisition of the latter’s professional services unit that ultimately cost it £450 million in write-downs.
Slater was seeking £637 million in damages, less than the £673 million it paid for the business shortly before the UK’s Serious Fraud Office began an investigation into Quindell’s accounting practices.
Watchstone hit back with a £63 million counterclaim in August, alleging that Slater’s corporate finance advisor, Greenhill & Co, had established a “back channel” with its restructuring consultant, PwC, to obtain confidential information during negotiations.
However, the two sides have walked away with far less than intended, with Watchstone receiving £39 million and Slater £11 million. Neither firm has admitted any wrongdoing.
While the settlement may not be as much as the company was after, Watchstone’s investors seem relieved the matter has been put to rest, as the shares shot up 55% to 166p during the week.
The AIM All-Share was 1.3% higher at 892 in the week, while the FTSE 100 was up 2.2% at 7,306.
The company, which sells 18mln pairs of shoes each year, saw revenues rise by 1% to £161.9mln in the 53 weeks to 5 October. The stabilised performance was enough to push the shares up 16% to 131p over the week.
Firestone Diamonds PLC (LON:FDI) sparkled after a trading update said a power outage that had affected operations at its Liqhobong mine in Lesotho was expected to be resolved by early November. The stock surged 29% to 0.7p in response.
Despite profits in its latest full-year being almost completely wiped out, falling to £100,000 from £2.7 million, the company predicted “significant organic growth” in the coming year.
Personnel and talent management specialist Mind Gym PLC (LON:MIND) also flexed 9% higher to 134p as the firm said full-year revenues would be slightly ahead of expectations after increasing the proportion of incomes derived from its 25 biggest accounts.
The firm originally filed the claim in September last year against the government of the state following the rejection of a prospecting license application from its joint venture partner, however, since then the process has been hit by several delays, the most recent being due to “staff shortages” at the court.
Revenue in the six months to the end of September fell to £824,000 from £1.16 million in the same period of 2018, while gross profit declined 30% to £499,000 from £710,000.
Troubled phone app and game distributor Mobile Streams PLC (LON:MOS) plunged 32% to 0.2p after telling investors that it had still not managed to find a new nominated advisor, a requirement to trade on the AIM market. If the firm fails to find a replacement before next Tuesday, its shares will be suspended.