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Two major banks have appointed a prominent mid-tier advisory firm to lead an investigation into the books of Slater and Gordon, after a tumultuous 2015 for the law firm.
Mid-tier appointed to Slater and Gordon investigation
08 January 2016
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3 minute read
As reported in The Australian, National Australia Bank and Westpac have appointed McGrathNicol to gain a clearer idea of the company’s financial position.
The decision follows a dire year for the listed law firm, which has weathered a falling stock price and controversy around its acquisition of UK firm Quindell’s professional services division.
The stock price fell again this week, by 2.6 per cent to 73 cents a share, after dropping nearly 90 per cent since April 2015, and recently prompted rival firm Maurice Blackburn to prepare a class action against the firm on behalf of shareholders.
Slater and Gordon group managing director Andrew Grech addressed the reports in an ASX statement late Thursday afternoon.
"In our FY16 financial update on 17 December 2015, we informed the market that Slater and Gordon has more than AU$100 million headroom within its banking facilities, that this headroom is expected to increase as the financial year progresses, and that we had commenced a review of the company's forecasts by group CFO Bryce Houghton and independent advisers appointed by the board," Mr Grech stated.
"As part of that review process, we agreed that our banking syndicate would appoint their own advisers who will work alongside those appointed by the board. The company has continued to work collaboratively and cooperatively with the banks and our advisers."
The appointment follows the decision of mid-tier firm Pitcher Partners, which stepped down from the auditing role for the beleaguered law firm, subsequently replaced by Big Four firm EY.
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