Australian former directors of national firm Slater and Gordon have told the High Court that they did not make firm plans to bid £700m for the legal arm of listed company Quindell.

Giving evidence this week in the Rolls Building, Andrew Grech and Ken Fowlie both dismissed the importance of research produced by the firm at the time that this figure was in mind. In the event, Slater and Gordon – which has since changed ownership – paid around £640m for Quindell’s professional services division in May 2015.

Quindell (now named Watchstone) is suing its own former adviser PwC for alleged breach of duty and unlawful means conspiracy in relation to a meeting in January 2015 between a PwC partner and a representative from Greenhill, advisers to Slater and Gordon. It is alleged that confidential information shared at the meeting about the precarious nature of Quindell’s finances was fed back to Slater and Gordon, prompting the firm to reduce its offer price by around £63m.

PwC denies all Watchstone's claims, Slater and Gordon, which is now under different management, is engaged as a Part 20 defendant under a full indemnity provided by Watchstone.

In court this week, both Grech and Fowlie were cross-examined about the so-called ‘fair value’ of Quindell. The court heard that Slater and Gordon estimated that it should offer six times the annual pre-tax profit figure. Tim Lord KC, for Watchstone, said that the potential buyers had assessed the EBITDA at £119m, giving a ‘fair value’ of more than £710m.

Fowlie said Lord’s method of calculating what Quindell should have been worth was ‘artificial and mechanical and not actually what was happening’. He added: ‘Our approach to assessing the right number was not an arithmetic or inflexible exercise, to be clear. The six-times EBITDA [method] was a starting point and a relevant building block.’

Fowlie said Slater and Gordon was ‘at the limit’ of what it was willing to pay when it offered £640m.

Pressed by Lord on whether the firm benefitted from access to confidential information, Fowlie replied: ‘I don’t accept we had information in our possession which we ought not to have had.’

Following him into the witness box, former Slater and Gordon managing director Andrew Grech was also asked about the calculations for determining Quindell's value. He accepted that the firm had secured funding to spend £730m on the deal, but denied there were ever plans to offer more than £700m.

Lord told Grech: ‘You are blurring and trying to make more fuzzy the price by which Slater and Gordon ended up valuing [Quindell’s] business. It looked as if on 20 February you are contemplating moving to an offer as high as £700m.’ Grech replied: ‘I don’t agree with that.’

Lord said Grech and his fellow negotiators had ‘leverage’ over Quindell, adding: ‘In your negotiations you will have had in your mind the various points of leverage that came from PwC [and the subsequent] briefings – that is what explains how you were able to secure a deal at £640m when your model showed £730m-plus.’

Asked if he harboured any ‘ill feeling’ towards Quindell, Grech responded: ‘I don’t feel any ill feeling towards the entity.’

‘But you do towards certain people?’ asked Lord.

‘Yes, principally [former chief executive Robert] Fielding,’ Grech answered. 

The hearing will conclude with three days of submissions next week.