Slater & Gordon shares have been suspended from trading ahead of the company reporting its interim results on Monday, February 29.
In a statement to the Australian Securities Exchange, company secretary Moana Weir said ‘certain material items’ had not been finalised, such as the goodwill values for impairment of the UK business.
The “voluntary suspension” is so that the company can meet its continous disclosure obligations ahead of finalising a potential goodwill write-down.
Slater & Gordon said “it continues to work with its auditors and external advisors to finalise and confirm” these items.
Shares of Slater & Gordon closed on Tuesday at 83¢, valuing the law firm at just under $300 million. In late March, the personal injury law firm’s market capitalisation peaked at almost $2.75 billion.
The company showed $1.15 billion of “goodwill” on its book when it reported full year financial results for 2015.
In March, Slater & Gordon acquired the professional services division from UK listed firm Quindell for $1.3 billion, of which $710 million was a “goodwill” consideration. However that acquisition has proved ill-fated, straining the law firm’s cash flows, while touted regulatory changes have cast doubt over future profits from fast-track road accident claims.
Slater & Gordon’s lenders have appointed advisers to assess the company’s books.
Recent disclosures from Westpac, a major lender to Slater & Gordon, showed it had increased provisions relating to a property and business services loan, which the bank told analysts was an exposure to Slater & Gordon.
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