Claims Direct buyout bid confirmed

The insurer’s founders say its business model is no longer viable.

Tony Sullman and Colin Poole, founders of personal injury insurance company Claims Direct, have confirmed the terms of their proposed management buyout of the company.

Sullman and Poole, who already hold 42.8 per cent of Claims Direct, are offering ten pence per share for the rest of the balance, valuing the stake they do not own at £11.1m.

When Claims Direct became a listed company last year, it was valued at £346m. Its share price tumbled after a profit warning in March this year.

Sullman went on record saying that “the business environment in which Claims Direct Group operates has altered rapidly and I believe that […] the current business model is no longer viable.”

Since the offer was first announced on Tuesday, the firm’s shares have dropped sharply, loosing 17 per cent on Tuesday and another 2 per cent today following the confirmation of the offer, Reuters reports.

Earlier this week, the firm announced a pre-tax loss of £20.2m for the past financial year.