Slater & Gordon 'forced' into debt restructure talks: Report

Beleaguered law firm Slater & Gordon is in talks about restructuring debt and has appointed a firm of British advisers to assist with the process, according to a report. 

Britain's Telegraph newspaper reported that the firm has appointed FTI Consulting after being "forced" into debt restructuring discussions. 

Reports from Britain say Slater & Gordon has been forced into debt restructuring talks.
Reports from Britain say Slater & Gordon has been forced into debt restructuring talks.  Photo: Lee Besford

In January, Slater & Gordon confirmed media reports that McGrathNcol, the Australian based accounting and insolvency firm has been appointed by the bank's senior lenders as an independent advisor. 

A Slater & Gordon spokeswoman confirmed on Monday that FTI had in turn been appointed by McGrathNicol.  

Slater & Gordon acquired the professional services division of Quindell for $1.3 billion last year, but the company was later investigated by the Britain's Financial Conduct Authority over its aggressive accounting practices. 

Slater & Gordon has said it took a cautious approach to the Quindell accounts during its due diligence. But Slater & Gordon's share price has plummeted after problems with its own accounting processes, earnings downgrades and questions over the price it paid for the Quindell business. 

In July Slater & Gordon had secured a £419 million loan to finance the Quindell acquisition. The loan, denominated in pounds and Australian dollars, was arranged by Westpac and National Australia Bank with equity markets bankers Citi and Macquarie also participating. This year the lenders appointed accounting and insolvency firm McGrathNicol to examine the law firm's books.

Last week Slater & Gordon was unable to update investors on its cash flows for the first six months of the year, as scheduled, after initially warning they would be negative by $30 million to $40 million.  

*The story was updated from an earlier version to include a response from the company that FTI had been appointed by McGrathNicol.