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| Share Name | Share Symbol | Market | Stock Type |
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| Burford Capital Limited | BUR | London | Ordinary Share |
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| 13.00 | 1.07% | 1,226.00 | 16:35:12 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
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| 1,201.00 | 1,201.00 | 1,235.00 | 1,226.00 | 1,213.00 |
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Posted at 24/4/2024 02:26 by lazg Burford Capital seeks Argentina’s YPF stake to pay US$16-billion awardBurford Capital asks US judge to grant it controlling 51% stake in YPF as part of its effort to collect on a US$16-billion court judegment. Burford Capital asked a US judge to give it control of Argentine state oil company YPF SA as part of its effort to collect on a US$16-billion court judgement against the Latin American country. In a motion filed Monday in New York, Burford asked US District Judge Loretta Preska to grant it the 51 percent stake in YPF currently held by Argentina’s federal and provincial governments. Preska is also the judge who in September issued the judgement that Burford is now trying to collect. Burford had sought to keep its filings secret, saying that news of its collection effort could impede efforts to resolve the issue. It would also attract attention in Argentina “because the motion calls into question the republic’s continued majority ownership and control over YPF,” Burford said in a court filing. Argentina opposed. Preska declined to seal the filings. Neither Burford nor the Argentine government responded to emails seeking comment. Even if Preska orders that Argentina’s YPF shares be handed to Burford, it’s unclear how the litigation funding firm would enforce that decision. Argentina has in the past fought foreign judgments, but those disputes have also harmed the country’s ability to raise overseas capital. Burford is asking the judge to order Argentina to transfer its class D shares in YPF through a custodial account at Bank of New York Mellon. According to the filing, the shares are not covered by a US law that shields certain assets of foreign governments, and Argentina has used them to back debt securities sold to US investors. But Burford acknowledged it has “a long road ahead” to collect the full judgement, “given Argentina’s many years of structuring its assets to avoid enforcement.” It said a court order requiring Argentina to hand over the shares could be the only way to force the nation to engage in negotiations over the judgement. A 51 percent stake in YPF is currently worth about US$4 billion, roughly a quarter of the judgement. The case in which Burford is seeking to collect stems from the Argentine government’s seizure of YPF in 2012. Preska found that re-nationalisation violated YPF by-laws requiring the company to make a tender offer to all shareholders. Argentina is appealing the ruling but failed to post security for the judgment during the appeal. That led Preska to rule in January that the judgement — the biggest ever ordered by the federal court in Manhattan — was subject to immediate collection, before the appeal is decided. Burford, which paid US$16.6 million to acquire the interests of two groups that held YPF shares at the time, stands to make some US$6.2 billion if the full judgement is paid. The case is Argentine Republic v. Petersen Energia Inversora SAU, 23-7370, 2nd US Circuit Court of Appeals (Manhattan). by Bob Van Voris & Jonathan Gilbert, Bloomberg |
Posted at 28/3/2024 14:23 by tradertrev This paragraph of the shareholder letter in today's Annual Report should attract some interest:"We also believe we have reached the point of financial capacity and maturity such that we can try for a few “more Petersens”. What that really means is having a willingness to take on some matters that come with higher risk and potentially longer duration but the prospect of much higher returns upon success. We have largely avoided such matters in the past, sensitive to public investors’ preference for lower risk, shorter duration, more predictable matters; Petersen was an outlier for us because, candidly, we were able to obtain the rights to the matter very inexpensively compared to its potential value. However, we are missing out on a valuable portion of the litigation market with this approach, and we believe our scale permits us to take on over time a few more matters with moderate capital outlay that have the potential for ten-figure outcomes." |
Posted at 26/3/2024 16:21 by chester9 From Seb with thanks Beneficiaries of the YPF ruling:"It is always appropriate to require parties to fulfill contractual promises, but when it comes to foreign governments and international financial markets, it is absolutely essential.The promises of the Argentine Republic were not improvised comments or informal agreements. They were unusual-and exceptionally clear-commitments necessary to provide peace of mind to potential investors and allow a foreign nation with a troubled economic past to access U.S. financial markets and raise billions of dollars by privatizing YPF.If those promises can be ignored with impunity, plaintiffs will be hurt in the short term, but everyone, investors and foreign governments alike, will lose in the long term."This court must enforce the promises Imade by the Argentine Republic when privatizingYPF] and correct its clear contractual breaches."It is alwave anpronriate to hold narties to their contractual nromises-butPost your reply |
Posted at 15/3/2024 10:55 by kuk1doh If this link doesn’t work you will find it in investor relations section with the documentation released for yesterday’s results and webcast. |
Posted at 22/2/2024 18:21 by tail_risk From Greenhaven Road Q4 Letter:Burford (BUR) The litigation finance company is by definition "playing the long game" as their average case takes almost three years from funding to resolution, but many take significantly longer. As a result, earnings in three years really are being driven by the investments being made today. The two senior managers of Burford each own more than $100M worth of stock. They are building an asset management business. Two of management's priorities with long-term implications are to continue to build out both their data science infrastructure Burford believes that they have the best proprietary data on legal settlements, which improves their case underwriting and thus long-term returns and their customer base. Historically, the "deal pipeline" of cases came from law firms looking to get their legal work paid for by Burford so that clients were more likely to pursue their cases. Increasingly, large companies are coming to Burford with cases as a case financed by Burford allows management to pursue a case without hurting current year earnings and their current year bonuses. Burford is currently working with 2 Fortune 50 companies. Working directly with corporates is going to be important for continuing to grow the litigation financing business. Like the rest of Burford's investor base, I am paying attention to their Argentina YPF case because if and when they can collect their judgement the potential proceeds exceed the market capitalization of the company. The developments with the new Argentinian president are incrementally positive for Burford. We are also tracking several other material cases, including Sysco, and any indications of continued progress on the corporate front. As discussed in our investor presentation (to investors only) that accompanied our last letter, Burford's business is one where power laws can come into play. In general, they earn good returns on average for "meat and potatoes" type cases but have the potential to earn incredible returns on a smaller basket of cases which can have outsized impacts on business valuation. |
Posted at 08/1/2024 22:42 by chester9 Argentina seeks to block asset seizure to help satisfy $16.1 billion judgmentBurford CapitalBurford CapitalNewsan hour agoNEW YORK, Jan 8 - Argentina on Monday urged aU.S. judge not to let Burford Capital BURF.L begin seizingassets this week as part of the litigation funder's effort toenforce a $16.1 billion judgment against the country.In a filing in federal court in Manhattan, Argentina calledBurford's stated intention to start asset seizures afterWednesday "unnecessary and premature," given that the judgmentis fewer than four months old and is being appealed.Argentina said numerous other courts have found 10- to15-month waits in comparable cases were reasonable.It also said principles of international comity and the"extraordinary and unique circumstances" of its case justifiedno rush. Argentina said $16.1 billion is 32% of its fiscal 2023budget.Preska agreed not to enforce her Sept. 15, 2023, judgmentuntil the earlier of Argentina's failure to pledge assets byJan. 10 or seek an expedited appeal by Jan. 30.On Jan. 2, Burford said it has waited long enough, afterArgentina "made clear that it does not intend to post theminimal security required to continue the (stay) pending appeal,much less pay the judgment."Burford faces a Tuesday noon deadline to respond toArgentina's filing.The judgment arose from Argentina's 2012 decision to seize a51% stake in oil company YPF held by Spain's Repsol REP.MCwithout tendering for shares held by minority investors.Two investors, Petersen Energia and Eton Park CapitalManagement were awarded the $16.1 billion, and Burford has saidit was entitled to 35% and 73% of their respective damages.Argentina President Javier Milei told La Nacion last monththat the country could issue a perpetual bond, which has nomaturity date, if required to pay the judgment. |
Posted at 08/1/2024 13:31 by lomax99 FT today:Argentina’s new government faces crucial test over $16bn US judgment Plaintiffs on collision course with country’s pro-market president despite Milei’s professed ‘willingness to pay’ Argentina’s new president Javier Milei is facing a critical test of his pledge to rebuild the serial defaulter’s reputation on the world stage, as his cash-strapped government struggles to meet a looming deadline on the $16bn it owes to former private shareholders of state energy company YPF. Last year a New York judge ruled that Argentina owed the record sum to two now-defunct investors that had sued after the country’s government declined to buy out their shares at an agreed rate when it expropriated YPF in 2012. Their claims were largely financed by litigation funder Burford Capital in exchange for a percentage of the award. Argentina has appealed against the judgment. While it pursues its case in the 2nd Circuit Court of Appeals, Judge Loretta Preska has ordered it to post assets worth some $5bn as collateral by January 10, after which point plaintiffs say they would be forced to try to assert their rights by seizing Argentine assets. Analysts say Argentina is all but certain to miss the deadline. The case risks becoming a headache for the pro-market president, who has attempted to distinguish himself from the left-leaning Peronist politicians who expropriated YPF. Since taking office in December, Milei and his officials have repeatedly touted Argentina’s “willingness to pay”, while at the same time arguing that a severe shortage of hard currency and political roadblocks prevent them from doing so in the near term. Plaintiffs say Milei has not assuaged their concerns that Argentina, which has faced waves of drawn-out international litigation over the last two decades, is again seeking to avoid meeting its obligations. “Despite the welcome and optimistic statements of Argentina’s new president, Argentina’s lawyers have made it clear that the Republic will not co-operate in even basic things,” they wrote to the judge last week. Argentina is currently in the midst of its worst economic crisis in two decades, with annual inflation running above 200 per cent and four in 10 people living in poverty. The central bank’s foreign exchange reserves are roughly $8bn in the red. The $16bn sum is equivalent to 32 per cent of the 2023 government budget, Argentina’s lawyers noted in December. US- and UK-listed Burford, whose cut of the $16bn would be around $6bn, has told shareholders it is very unlikely the whole sum will be recovered. Recognising Argentina’s “extraordinary and unique circumstances” Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found at The assets she has deemed appropriate are the 26 per cent of YPF shares now owned by Argentina’s national government — a further 25 per cent are held by the country’s provinces — and payments that the country is due to start receiving from Paraguay in 2028 in relation to a hydroelectric border dam. Argentina’s lawyers have said they cannot “legally or practically” submit those by January 10. The former would require congressional approval — difficult for Milei’s government to secure quickly — and “the economic situation of the country wouldn’t permit” the latter, Argentina’s attorney-general Rodolfo Barra told La Nación newspaper on December 31. In late December, Milei floated the idea of issuing a perpetual bond to pay its obligations, and charging Argentines what he dubbed a “Kicillof tax” to pay the interest — named for Axel Kicillof, the Peronist former minister and now governor of Buenos Aires Province, who championed the YPF expropriation in 2012. Investors have widely panned the idea, citing non-existent demand for long-term bonds from Argentina. “There is no earthly way that I know of for Argentina to present collateral by January 10,” said Sebastián Maril, a director at consultancy Latam Advisors who has closely followed the case. If Argentina fails to submit collateral, the next move would lie with the plaintiffs. They have asked Preska for clarification on whether, should Argentina miss its January 10 deadline, they will be permitted to begin what they have called the “arduous and time-consuming process” of attempting to claim the $16bn judgment by seizing Argentine assets. Experts say that would be exceedingly difficult, if not impossible. They note that US law protects Argentina’s assets in the country, except any used as part of the country’s moves to renege on its contracts in 2012, which likely do not exist. History suggests the plaintiffs will also struggle outside the US. Argentina was famously involved in a cat-and-mouse game with holdout creditors from a sovereign debt restructuring, in which lawyers for so-called “vulture fund” Elliott Capital spent years trying to pin down significant Argentine holdings. A high-profile attempt to seize an Argentine Navy vessel in a port in Ghana in 2012 was blocked by the UN International Tribunal for the Law of the Sea. A deal was ultimately reached in 2016. Sebastián Soler, who served as Argentina’s assistant attorney-general in the previous Peronist government, said on X that seizures in this case would be even more challenging than they were for the bondholders, who benefited from a clause in Argentina’s bonds renouncing some US legal protections for their assets. The conditions “represent a VERY big obstacle for the plaintiffs”, he said. “Of course, that doesn’t mean that they won’t try anyway. Or that they won’t [try to seize assets] as a harassment strategy, knowing that it won’t work.” While a stand-off appears imminent, Maril said the appeal and recovery efforts may be a backdrop for behind-the-scenes negotiations between Argentina and the plaintiffs. Milei’s government, he said, “has clearly recognised that Argentina almost always ends up losing these cases .&thins He added: “The plaintiffs should be encouraged that for the first time in 25 years, Argentina has a government that has shown it intends to stop kicking the can down the road.” |
Posted at 28/12/2023 11:38 by djderry If a mechanism can be devised whereby Bur is guaranteed a 2/3/4 hundred million dollar yearly payment,it would,of course,be transformative.It's not beyond the ability of clever lawyers to layer a series of protections whereby,if in default,the original amount plus interest becomes payable.Would it be transformative for the share price? Who knows.As has been posited here,it can be made to do so,ie with share buybacks or special dividends. Please note,I am not calling for either.Remember,most on here are punters,happy to make 20/30/50 percent on a share.As you see today weak holders sell out. Who can blame them? If you have never invested in a two/five or ten bagger,you don't realise it is possible.When the share price goes to £18.50,you'll have lots of selling ( many institutional investors got in at that price,there'll be lots of resistance at £20 as well,just because of the first digit changing! Investors practise the art of inactivity. |
Posted at 08/9/2023 19:08 by tonysss13 BUR statement outGraphic Exhibit 99.1 8 September 2023 BURFORD CAPITAL STATEMENT ON YPF DAMAGES RULING Court’s Ruling suggests a final judgment of approximately $16 billion against Argentina Burford Capital Limited, the leading global finance and asset management firm focused on law, today releases the following statement in connection with the September 8, 2023 Findings of Fact and Conclusions of Law (the “Ruling” The Ruling follows a prior decision on March 31, 2023 by the Court granting summary judgment on liability against Argentina and setting for an evidentiary hearing questions around the date on which Argentina should have made a tender offer for YPF’s shares and the appropriate rate of pre-judgment interest to be applied. That evidentiary hearing was held on July 26-28, 2023 and the Ruling is the Court’s decision on the issues raised for hearing. The Court decided the issues raised at the hearing in Petersen’s and Eton Park’s (collectively, “Plaintiffs The Court has asked the parties to memorialize the Ruling in a proposed judgment and submit it to the Court, which Petersen and Eton Park will endeavor to do forthwith. We discuss below the computation of potential damages but in round numbers the Court’s Ruling implies a judgment against Argentina of approximately $16 billion. In other words, the Ruling results in a complete win against Argentina at the high end of the possible range of damages. Jonathan Molot, Burford’s Chief Investment Officer who leads Burford’s work on the Case, commented: “We have been pursuing this case since 2015 and it has involved substantial Burford management time along with the dedicated engagement of a team of some of the best lawyers on the planet from multiple law firms and world-class experts (going up against very good lawyers, and winning). Burford is uniquely positioned to pursue these kinds of cases and secure wins for clients and substantial returns for shareholders – not only because of the size and scale of these kinds of cases, but because of the internal and external resources we can uniquely bring to bear. There is no aspect of this case, from strategy to minutiae, that did not involve an experienced Burford team spending many thousands of hours getting to this point. This case represents what Burford is all about and exemplifies the contribution we make to the civil justice system – without us, there would be no justice in this complicated and long-running case for Petersen and Eton Park.” Graphic Christopher Bogart, Burford’s Chief Executive Officer, commented: “In our recent shareholder letter, we referred to the YPF-related assets as one of Burford’s four pillars of value and I’m pleased to see this extraordinary win and the value it could create for our shareholders once we complete the litigation process and collect from Argentina. The Ruling is a major milestone for Burford and we continue to see momentum in our overall portfolio and continued demand for our capital and services.” Introductory matters As is customary in US litigation, the Ruling was released without prior notice to Burford or the parties by its posting on PACER, the publicly available official US federal court site, at 10:45am EDT on September 8, 2023, and was thus public immediately upon release. The Ruling is also available in its entirety on Burford’s IR website at hxxp://investors.bur While Burford offers in this release its views and interpretation of the Ruling, those are qualified in their entirety by the actual text of the Ruling and we caution that investors cannot rely on Burford’s statements in preference to the actual Ruling. In the event of any inconsistency between this release and the text of the actual Ruling, the text of the actual Ruling will prevail and be dispositive. Burford disclaims, to the fullest extent permitted by law, any obligation to update its views and interpretation as the litigation proceeds. Moreover, the Case remains in active litigation and Argentina has declared its intention to appeal any decision; all litigation carries significant risks of uncertainty and unpredictability until final resolution, including the risk of total loss. Finally, Burford is and will continue to be constrained by legal privilege and client confidences in terms of the scope of its ability to speak publicly about the Case or the Ruling. Burford also cautions that there are meaningful remaining risks in the Case, including further proceedings before the Court, appeals, enforcement and collateral litigation in other jurisdictions. Moreover, litigation matters often resolve for considerably less than the amount of any judgment rendered by the courts and to the extent that any settlement or resolution discussions occur in this Case no public communication about those discussions will be possible until their conclusion. The Ruling The Court previously held that (i) the bylaws “on their face, required that the Republic make a tender offer” for Petersen’s and YPF’s shares; (ii) “the Republic failed to make the tender offer”; and (iii) the failure “harmed Plaintiffs because they never received the compensated exit” that the bylaws promised. Indeed, the Court held that “once the Court decides the legal issues, the relatively simple facts in this case will demand a particular outcome” and held that “there is no question of fact as to whether the Republic breached”. Thus, the Court held that “Plaintiffs were damaged by the Republic because Plaintiffs were entitled to receive a tender offer that would have provided them with a compensated exit but did not”. Graphic The Court previously held that the damages to be awarded will consist of the tender offer price under Formula D of the bylaws calculated in US dollars as of a constructive notice date that is 40 days prior to Argentina taking control and triggering the tender offer obligation. The Court said it must decide as a factual matter whether the operative notice date for the calculation is 40 days before April 16, 2012, when the Presidential intervention decree was implemented, or 40 days before May 7, 2012, when the Argentine legislature took follow-up action. In the Ruling, the Court concluded that April 16, 2012 was the appropriate date. The calculation of damages using a notice date that is 40 days before the April 16, 2012 takeover was included in Plaintiffs' publicly filed summary judgment brief and would imply tender offer consideration of approximately $7.5 billion for Petersen and $900 million for Eton Park, before interest. The Court also previously reserved for determination the prejudgment interest rate that would run from the date of the breach in 2012 through the issuance of a final judgment in 2023. The Court accepted that “the commercial rate applied by the Argentine courts is the appropriate measure” and noted that Plaintiffs had pleaded that that rate was “between 6% and 8%”, but “the Court reserves judgment on the precise rate it will utilize”. After the hearing, the Court ultimately applied an 8% rate from May 3, 2012 until the date of the judgment, and thereafter interest will accrue at the applicable US federal rate until payment. Subject to final computations by the parties’ experts, that finding implies interest of approximately $6.8 million for Petersen and $815 million for Eton Park, yielding a total judgment of approximately $14.3 billion for Petersen and $1.7 billion for Eton Park, or $16 billion in total. Investors may find notable the Court’s commentary on Burford’s role in the case: The Court also rejects the Republic’s effort to inject Burford Capital into these proceedings. This remains a case brought by plaintiffs against a defendant for its wrongful conduct towards them, and the relevant question is what the Republic owes Plaintiffs to compensate them for the loss of the use of their money, not what Plaintiffs have done or will do with what they are owed. The Republic owes no more or less because of Burford Capital’s involvement. Furthermore, the Republic pulled the considerable levers available to it as a sovereign to attempt to take what it should have paid for and has since spared no expense in its defense. If Plaintiffs were required to trade a substantial part of their potential recovery to secure the financing necessary to bring their claims, in Petersen’s case because it was driven to bankruptcy, and litigate their claims to conclusion against a powerful sovereign defendant that has behaved in this manner, this is all the more reason to award Plaintiffs the full measure of their damages. Next steps The Court has asked the parties to submit a proposed judgment reflecting the Ruling, which Plaintiffs will endeavor to do promptly. Once that judgment issues, Argentina has indicated its intention to appeal. There is also a process for seeking reconsideration from the District Court of its own ruling, although such motions rarely prevail as they are being made to the same judge who decided the matter originally. Graphic Once the Court issues its final judgment, that judgment will be appealable as of right to the Second Circuit Court of Appeals. The Second Circuit presently is taking around a year to resolve appeals once filed, although there is meaningful deviation from that mean. The District Court’s judgment would be enforceable while the appeal is pending unless Argentina posts a bond to secure its performance, which we consider unlikely, or unless a court grants a relatively unusual stay. Following the Second Circuit’s decision, either party can seek review from the Supreme Court of the United States. The Supreme Court accepts cases only on a discretionary basis and we believe the likelihood of it accepting a commercial case of this nature that does not present a contested issue of law is quite low, particularly given that Argentina has already once in this Case unsuccessfully sought Supreme Court review. With an enforceable judgment in hand, Plaintiffs will either need to negotiate a resolution of the matter with Argentina, which would certainly result in what would likely be a substantial discount to the judgment amount in exchange for agreed payment, or engage in an enforcement campaign against Argentina which would likely be of extended duration relying on Burford’s and its advisors’ judgment enforcement expertise. Burford will not provide publicly any information about its enforcement or settlement strategies. Burford’s position Burford has different economic arrangements in each of the Petersen and Eton Park cases. At bottom, on a net basis, we expect that the Burford balance sheet will be entitled to around 35% of any proceeds generated in the Petersen case and around 73% of any proceeds generated in the Eton Park case. In the Petersen case, Burford is entitled by virtue of a financing agreement entered into with the Spanish insolvency receiver of the Petersen bankruptcy estate to 70% of any recovery obtained in the Petersen case. That 70% entitlement is not affected by Burford’s spending on the cases, which is for Burford’s account; it is a simple division of any proceeds. From that 70%, certain entitlements to the law firms involved in the case and other case expenses will need to be paid, reducing that number to around 58%. Burford has, however, sold 38.75% of its entitlement in the Petersen case to third party investors, reducing Burford’s net share of proceeds to around 35% (58% x 61.25%). In the Eton Park case, there is both a funding agreement and a monetization transaction. The net combined impact of those transactions is that Burford would expect to receive around 73% of any proceeds. Burford has not sold any of its Eton Park entitlement. In both Petersen and Eton Park, the numbers above are approximations and will vary somewhat depending on the ultimate level of case costs by the end of the Case, as we expect continued significant spending on the Case. Graphic For further information, please contact: Burford Capital Limited For investor and analyst inquiries: Robert Bailhache, Head of Investor Relations, EMEA and Asia – email +44 (0)20 3530 2023 Jim Ballan, Head of Investor Relations, Americas – email +1 (646) 793 9176 For press inquiries: David Helfenbein, Vice President, Public Relations – email +1 (212) 235 6824 Numis Securities Limited – NOMAD and Joint Broker +44 (0)20 7260 1000 Giles Rolls Charlie Farquhar Jefferies International Limited – Joint Broker +44 (0)20 7029 8000 Graham Davidson Tony White Berenberg – Joint Broker +44 (0)20 3207 7800 Toby Flaux James Thompson Arnav Kapoor About Burford Capital Burford Capital is the leading global finance and asset management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the New York Stock Exchange (NYSE: BUR) and the London Stock Exchange (LSE: BUR), and it works with companies and law firms around the world from its offices in New York, London, Chicago, Washington, DC, Singapore, Dubai, Sydney and Hong Kong. For more information, please visit www.burfordcapital.c This announcement does not constitute an offer to sell or the solicitation of an offer to buy any ordinary shares or other securities of Burford. This announcement does not constitute an offer of any Burford private fund. Burford Capital Investment Management LLC, which acts as the fund manager of all Burford private funds, is registered as an investment adviser with the US Securities and Exchange Commission. The information provided in this announcement is for informational purposes only. Past performance is not indicative of future results. The information contained in this announcement is not, and should not be construed as, an offer to sell or the solicitation of an offer to buy any securities (including, without limitation, interests or shares in any of Burford private funds). Any such offer or solicitation may be made only by means of a final confidential private placement memorandum and other offering documents. Graphic Forward-looking statements This announcement contains “forward-looki Except as required by law, Burford undertakes no obligation to update or revise the forward-looking statements contained in this announcement, whether as a result of new information, future events or otherwise. |
Posted at 02/4/2023 19:22 by jockthescot75 2 April 2023Released out of hours on April 2, 2023, and queued for release via RNS upon its reopening on April 3, 2023. BURFORD CAPITAL STATEMENT ON YPF SUMMARY JUDGMENT RULING Court finds liability against Argentina with substantial damages expected to be awarded Burford Capital Limited, the leading global finance and asset management firm focused on law, today releases the following statement in connection with the March 31, 2023 Opinion and Order issued by the United States District Court for the Southern District of New York (the “Court”) in connection with the summary judgment motions filed by the parties (the “Ruling” At a high level, the Court decided that (i) Argentina was liable to Petersen and Eton Park for failing to make a tender offer for their YPF shares in 2012; (ii) YPF was not liable for failing to enforce its bylaws against Argentina; (iii) the various arguments Argentina had made to try to reduce its damages liability from the straightforward application of the formula in the bylaws were unavailing; and (iv) a hearing is needed to resolve two factual issues to enable the computation of damages. In other words, the Ruling was a complete win against Argentina with respect to liability, with the quantum of what we expect to be substantial damages yet to be determined, and a loss against YPF. However, no additional damages would have been payable had YPF also been found liable. Jonathan Molot, Burford’s Chief Investment Officer who leads Burford’s work on the Case, commented: “We have been pursuing this case since 2015 and it has involved substantial Burford management time along with the dedicated engagement of a team of some of the best lawyers on the planet from multiple law firms and world-class experts (going up against very good lawyers, and winning). Burford is uniquely positioned to pursue these kinds of cases and secure wins for clients and substantial returns for shareholders – not only because of their size and scale, but because of the internal and external resources we can uniquely bring to bear. There is no aspect of this case, from strategy to minutiae, that did not involve an experienced Burford team spending many thousands of hours getting to this point. This case represents what Burford is all about and exemplifies the contribution we make to the civil justice system – without us, there would be no justice in this complicated and long-running case for Petersen and Eton Park.” Christopher Bogart, Burford’s Chief Executive Officer, commented: “In our recent shareholder letter, we referred to the YPF-related assets as one of Burford’s four pillars of value and I’m pleased to see this significant step forward and the value it could create for our shareholders. The Ruling is a major milestone for Burford and we continue to see momentum in our overall portfolio and continued demand for our capital and services.” Introductory matters As is customary in US litigation, the Ruling was released without prior notice to Burford or the parties by its posting on Pacer, the publicly available official US federal court site, at 10:09am EDT on March 31, 2023, and was thus public immediately upon release. The Ruling is also available in its entirety on Burford’s IR website at hxxp://investors.bur The public release of the Ruling prompted trading activity in Burford’s stock and at 10:59am EDT the New York Stock Exchange (“NYSE”) suspended trading in Burford’s shares pending further information. Burford’s Nominated Advisor advised London Stock Exchange AIM (“LSE AIM”) of the Ruling and of the NYSE’s trading suspension and LSE AIM ultimately decided to suspend trading in Burford’s shares at 11:27am EDT. NYSE trading fully resumed at 11:54am EDT and it is expected that LSE AIM trading will resume at market open at 8:00am BST on Monday, April 3, 2023. While Burford offers in this release its views and interpretation of the Ruling, those are qualified in their entirety by the actual text of the Ruling and we caution that investors cannot rely on Burford’s statements in preference to the actual Ruling. In the event of any inconsistency between this release and the text of the actual Ruling, the text of the actual Ruling will prevail and be dispositive. Burford disclaims, to the fullest extent permitted by law, any obligation to update its views and interpretation as the litigation proceeds. Moreover, the Case remains in active litigation; all litigation carries significant risks of uncertainty and unpredictability until final resolution, including the risk of total loss. Finally, Burford is and will continue to be constrained by legal privilege and client confidences in terms of the scope of its ability to speak publicly about the Case or the Ruling. Burford also cautions that there are meaningful remaining risks in the Case, including further proceedings before the Court, appeals, enforcement and collateral litigation in other jurisdictions. Moreover, litigation matters often resolve for considerably less than the amount of any judgment rendered by the courts and to the extent that any settlement or resolution discussions occur in this Case no public communication about those discussions will be possible until their conclusion. The Liability Ruling The Court held that (i) the bylaws “on their face, required that the Republic make a tender offer” for Petersen’s and YPF’s shares; (ii) “the Republic failed to make the tender offer”; and (iii) the failure “harmed Plaintiffs because they never received the compensated exit” that the bylaws promised. Indeed, the Court held that “once the Court decides the legal issues, the relatively simple facts in this case will demand a particular outcome” and held that “there is no question of fact as to whether the Republic breached”. Thus, the Court held that “Plaintiffs were damaged by the Republic because Plaintiffs were entitled to receive a tender offer that would have provided them with a compensated exit but did not”. The Court rejected the many legal arguments advanced by Argentina; we summarize only a few here that have received particular attention from investors in the past: • The Court rejected the argument that because Argentina had taken years to finally transfer the legal ownership of the shares it expropriated from Repsol, Petersen and Eton Park lacked standing because they were no longer shareholders when the expropriation actually occurred formally. The Court held that Argentina’s argument “relies on a misreading of the Bylaws” and was “meritlessR • The Court held that Plaintiffs’ claims survived the transfer of their YPF shares, holding that under both New York and Argentine law their “accrued causes of action did not transfer” with their subsequent sales of their shares. • The Court rejected Argentina’s argument that only specific performance was available for breach of the bylaws, and held that Plaintiffs have “both the right to pursue damages and the right to elect damages as their remedy instead of specific performance”. As a result, the Court granted Plaintiffs’ motion for summary judgment on liability against Argentina. In other words, without the need for a trial, Argentina has been held to be liable for its breach of contract in failing to tender for Plaintiffs’ YPF shares as required by the bylaws. As to YPF, Petersen and Eton Park argued that YPF had a duty to enforce its own bylaws and prevent Argentina from taking control of YPF in a manner inconsistent with the bylaws. The Court disagreed and held that YPF “was not obligated to enforce” the bylaws against Argentina. Unless reversed on appeal, the Court’s ruling results in the dismissal of YPF from the case. YPF’s presence in the case was not a source of additional damages; the damages will be the same whether the case is against just Argentina or YPF as well. However, YPF’s dismissal may alter one potential path of enforcement of an ultimate judgment. Damages The Court set out its ruling on damages at pages 53-63 of the Ruling and we refer readers to the actual text of the Ruling. The Court reserved two issues necessary for the calculation of damages for a hearing, but it provided significant guidance on how it intends to approach those matters. First, the damages to be awarded will consist of the tender offer price under Formula D of the bylaws calculated in US dollars (rejecting the argument that damages should be expressed in Argentine pesos) as of a constructive notice date that is 40 days prior to Argentina taking control and triggering the tender offer obligation. The Court said it must decide as a factual matter whether the operative notice date for the calculation is 40 days before April 16, 2012, when the Presidential intervention decree was implemented, or 40 days before May 7, 2012, when the Argentine legislature took follow up action. The calculation of damages using a notice date that is 40 days before the April 16, 2012 takeover was included in Plaintiffs' publicly filed summary judgment brief and would imply tender offer consideration of approximately $7.5 billion for Petersen and $900 million for Eton Park, before interest. There is no publicly-filed evidence performing the same computation for 40 days before May 7, 2012, but public data would imply tender offer consideration of approximately $4.5 billion for Petersen and $550 million for Eton Park, before interest, although further expert analysis will be required to arrive at precise numbers. Inevitably, there will be differences between these hypothetical scenarios and the ultimate reality. Moreover, for the reasons expressed previously, including the likelihood of a substantial discount if the Case resolves through negotiated resolution, we do not endorse these as potential outcomes but present them solely for investor information based on currently available information – and disclaim any obligation to update them over time. Second, the Court reserved for future determination the prejudgment interest rate that would run from the date of the breach in 2012 through the issuance of a final judgment in 2023, which under any rate would result in a very substantial amount of interest. The Court accepted that “the commercial rate applied by the Argentine courts is the appropriate measure” and noted that Plaintiffs had pleaded that that rate was “between 6% and 8%”, but “the Court reserves judgment on the precise rate it will utilize”. The interest rate ultimately selected by the Court will then be applied from the date of the breach until the date of the judgment, and thereafter interest will accrue at the applicable US federal rate until payment. Moreover, the Court did not resolve claims relating to promissory estoppel and consequential damages and further consideration will need to be given to those claims. Next steps The Court has asked the parties to confer about how to take the remnant of this Case forward and report within 14 days. While we do not yet know Argentina’s position, it would be reasonable to expect the parties to agree on a short evidentiary hearing to enable the Court to hear evidence from some of the expert witnesses and then proceed to a decision. Nonetheless, between scheduling a hearing, providing post-hearing briefing and allowing time for a decision, it is reasonable to expect that process to occupy some number of months. There is also a process for seeking reconsideration from the District Court of its own ruling, although such motions rarely prevail as they are being made to the same judge who decided the matter originally. Once the Court issues its final judgment, that judgment will be appealable as of right to the Second Circuit Court of Appeals and based on past practice it would be surprising if Argentina did not appeal. After seeing Argentina’s appeal, Plaintiffs would decide whether to cross-appeal the dismissal of YPF. The Second Circuit presently is taking around a year to resolve appeals once filed, although there is meaningful deviation from that mean. The District Court’s judgment would be enforceable while the appeal is pending unless Argentina posts a bond to secure its performance, which we consider unlikely, or unless a court grants a relatively unusual stay. Following the Second Circuit’s decision, either party can seek review from the Supreme Court of the United States. The Supreme Court accepts cases only on a discretionary basis and we believe the likelihood of it accepting a commercial case of this nature that does not present a contested issue of law is quite low, particularly given that Argentina has already once in this Case unsuccessfully sought Supreme Court review. With an enforceable judgment in hand, Plaintiffs will either need to negotiate a resolution of the matter with Argentina, which would certainly result in what would likely be a substantial discount to the judgment amount in exchange for agreed payment, or engage in an enforcement campaign against Argentina which would likely be of extended duration relying on Burford’s and its advisors’ judgment enforcement expertise. Burford will not provide publicly any information about its enforcement or settlement strategies. Burford’s position Burford has different economic arrangements in each of the Petersen and Eton Park (collectively, “Plaintiffs At bottom, on a net basis, we expect that the Burford balance sheet will be entitled to around 35% of any proceeds generated in the Petersen case and around 73% of any proceeds generated in the Eton Park case. In the Petersen case, Burford is entitled by virtue of a financing agreement entered into with the Spanish insolvency receiver of the Petersen bankruptcy estate to 70% of any recovery obtained in the Petersen case. That 70% entitlement is not affected by Burford’s spending on the cases, which is for Burford’s account; it is a simple division of any proceeds. From that 70%, certain entitlements to the law firms involved in the case and other case expenses will need to be paid, reducing that number to around 58%. Burford has, however, sold 38.75% of its entitlement in the Petersen case to third party investors, reducing Burford’s net share of proceeds to around 35% (58% x 61.25%). In the Eton Park case, there is both a funding agreement and a monetization transaction. The net combined impact of those transactions is that Burford would expect to receive around 73% of any proceeds. Burford has not sold any of its Eton Park entitlement. In both Petersen and Eton Park, the numbers above are approximations and will vary somewhat depending on the ultimate level of case costs by the end of the Case, as we expect continued significant spending on the Case. |
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