Rob Terry ousted from Quindell

Quindell has responded to months of turmoil by ejecting Rob Terry, its founder and chairman, in a dramatic attempt to restore investor confidence.

The insurance claims processor, which has lost over £2bn in market value since April, confirmed Mr Terry's departure on Tuesday morning, but said he would remain as a paid consultant "to ensure an orderly transition".

David Currie, the former head of investment banking at Investec, and Quindell's highest-profile independent director, will become interim executive chairman.

"We look forward to completing our search for a new chairman and additional non-executive directors as soon as possible," said Mr Currie.

Finance director Laurence Moorse will step down after the 2015 annual meeting and leave a year later, while independent director Steve Scott will leave immediately. Both men had been involved in a controversial share deal, alongside Mr Terry, that saw them in effect sell shares while announcing they were buyers.

"I am clearly disappointed and sorry that events turned out as they did," said Mr Terry, adding he had acted "with the best of intentions". Mr Moorse and Mr Scott could not be reached for comment.

On Monday, Quindell revealed its joint broker, Canaccord, had resigned before the directors' share deal. The news knocked a further 19 per cent from the share price, which traded as low as 45p before recovering to close at 55.5p.

Quindell's board restated its confidence that the company, which is seeking to reduce insurers' costs in processing claims, and which has contracts for the rollout of black box technology in cars, has a strong business future.

Mr Terry also has walked away controversial share scheme that would have required him to buy £7.5m of the company's stock in two years' time. The move means that he has received about £5.5m in cash from share dealings before his departure from Quindell, which has seen its market value plummet.

Mr Terry, Mr Scott and Mr Moorse were all involved in the deal, where they sold stock to finance provider Equities First Holdings with a commitment to repurchase it in two years' time.

Other AIM-traded companies have also used such arrangements, whhcih supporters say allow directors to invest companies. Critics have questioned the transparency, pointing out that in Quindell's case the deals were wrongly described as share purchases.

A week ago Quindell said Mr Terry and the other directors had a "repurchase obligation" regarding the sold shares. But the recent falls in the share price meant that the men would have had to transfer more cash or shares to satisfy a margin call.

In a statement, Mr Terry said he "would expect to relinquish my rights to acquire 8,850,000 shares under the EFH Sale and Repurchase Agreement, rather than satisfying the margin call as this would now no longer make economic sense."

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"This will draw a line under this agreement and I have no intention of making further use of this agreement or its like again," he added.

It is the second time that Mr Terry has been ejected from an insurance company that he has founded. In 2003, he was forced from the board of Innovation Group, after that company suffered a similar share price plunge to Quindell.

Mr Currie, Quindell's new interim chairman, was an adviser to Innovation Group.

Mr Terry founded Quindell as a leisure company, buying an 18-hole golf course in Hampshire and investing in golf simulators. He transformed it into an insurance claims processor, legal services and telematics provider, which joined London's junior market Aim via a reverse takeover in 2011.

He had wooed retail investors and large institutional clients such as M&G and Investec with the promise of building a leading insurance technology company that could one day join the FTSE 100.

However, he became a lightning rod for many attacks, as shortsellers pored over related-party transactions involving Quindell and other companies in which he was a director.

Mr Terry continues to own more than 8 per cent of Quindell shares. Before his departure from the board, he had promised to spend millions of pounds buying more stock.

Quindell was denied permission to seek a main London listing by regulators this year.

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