This used to be Quindell PLC which was a successful short thesis by Gotham City. It was written up as well in the past on VIC as a long that was subsequently closed out (link).
The company is called Watchstone Group PLC (WTG) today and holds 193p cash per share as per 30 April 2020 (link).
The shares are trading @ 165/169.5p.
WTG has a publicly stated intention to return cash to shareholders if and where possible and has resolved via EGM to return 110p per share of cash by the 30th of June (link)
The company has been further de-risked recently because of a long-standing investigation by the Serious Fraud Office being diverted away from the company (link):
This is material as the SFO will not charge them a penalty any more.This was previously reserved at £20m (understood to be mentioned in the 2015 distribution court hearing documents).
A lingering class action lawsuit also loses its merits here as it would typically have relied on the SFO admitted findings to boilerplate it into its own case.
The logical catalyst will be that the £20m that was held back to cover any potential SFO fine will be distributed in the near term. On a PF basis we are then looking at a stock that will distribute 153p, with a NAV of 191-238p available @ ~ 167p. And the reason we look at it in that way is that we have to only fund the 110p for ~6 weeks to settle into the stub whilst we expect the additional 43p to come not long thereafter.
Last but not least, the CEO and finance director purchased some stock recently on the open market which is the first time after a 4 years+ hiatus.
I am skipping over a couple of assumptions which I am happy to discuss in the comments if they arouse any interest.
Assumption of cash burn until final liquidation.
Ingenie: a fully written down business that uses driver’s data to reduce insurance premium, that is currently for sale is included in the SOTP.
A claim against PwC is included in the SOTP.
I do not hold a position with the issuer such as employment, directorship, or consultancy. I and/or others I advise hold a material investment in the issuer's securities.
Settlement of current cash distribution followed by £20 more, followed by a sale of the Ingenie business.