Burford Capital

All articles about Burford Capital.

A long-standing legal dispute over the renationalisation of Aerolineas Argentinas has resurfaced in the United States, with a Washington DC court being asked to enforce a $325 million award issued against Argentina. The petition was filed by Titan Consortium 1 LLC, who acquired an interest in the case from Burford Capital in 2018 for $107 million. After an arbitration tribunal rendered an award in favour of the claimants in 2017, Burford decided to sell its stake in order accelerate cash recovery and be able to reinvest the capital. It reported a gain of $94.2 million on the case after investing $12.8 million into the matter.
Burford Capital has provided an update on its business performance for the six months ended June 30, 2021. The company saw $500+ million in new commitments, with a continuance in its trend towards funding larger and more complex new matters. Of its 14 new case investments, none had commitment levels under $5 million while six were $20 million or above. COVID has continued to impact the company, however, with an estimated 43% of cases incurring COVID-related delays, ranging from court date postponements to delays in the provision of discovery to slower settlement activity given the absence of a looming trial date to engender settlement. Optimistically, Burford believes that, due to how it often prices deals, ultimate returns may actually increase because of the passage of time.
Burford Capital is backing a claim by Union Investment, Germany's third largest asset manager, in the Wirecard insolvency proceedings. Union, a Wirecard shareholder, is seeking to have its equity claim elevated to the same level as other creditor claims so that it can participate in a distribution of recoveries.
The debate over disclosure of litigation funding in the US continues - a statement by Tim McCarthy of Verisk Analytics that "funding should be disclosed in the same way insurance details must be disclosed" has been met with stiff opposition from Andrew Lundberg of Burford Capital, who argues that litigation funding is “not relevant in the same way insurance coverage is required to be disclosed in litigation,” where parties are “effectively insured or indemnified against a bad outcome.”
After almost five years of fighting a high court ruling that awarded the UK’s largest ever divorce payout (£450 million), Russian billionaire Farkhad Akhmedov has reached a settlement with his ex-wife Tatiana and will give her £100 million in cash and about £50 million in artworks. Burford Capital has been paid nearly £75 million, which includes its commission for backing the case and about £40 million in legal fees.
The UK's push to promote London as the go-to centre for resolving commercial disputes means that grudges of foreign oligarchs, dictators and their hangers-on are now routinely fought in British courts, with Michael Redman of Burford Capital noting that the courts have potentially exposed themselves to reputational damage when the UK system becomes a tool in a wider battle of foreign litigants.
Various parties are responding to the Australian government's consultation paper proposing a cap on law firm and funder fees in Australian class actions. Last week, Burford made its arguments for why the 30% cap should be rejected, while the Australian Industry Group expressed its strong support for a 70% minimum gross return to class members.
Independent financial analyst Bruce Packard addresses the criticism of the high ROICs reported by funders, arguing that it is not comparable with the mid to high teens returns that companies like Unilever report and explains why Burford stopped reporting a "cash NAV."

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