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Share Name Share Symbol Market Type Share ISIN Share Description
Burford Capital Limited LSE:BUR London Ordinary Share GG00B4L84979 ORD NPV
  Price Change % Change Share Price Shares Traded Last Trade
  9.60 1.75% 558.60 409,726 16:35:13
Bid Price Offer Price High Price Low Price Open Price
554.60 556.80 570.80 547.00 549.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 276.01 170.05 73.14 7.5 1,221
Last Trade Time Trade Type Trade Size Trade Price Currency
17:07:46 O 2,000 558.60 GBX

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09/8/202012:08BURFORD CAPITAL :::::::::::::::::::::::::: Litigation Funding19,151
08/8/202021:10BUR Charts851
17/10/201911:13Burren could bid for Ramco?18
26/7/201910:09Half year call-
04/7/201908:41Bond do go down-

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DateSubject
10/8/2020
09:20
Burford Capital Daily Update: Burford Capital Limited is listed in the Equity Investment Instruments sector of the London Stock Exchange with ticker BUR. The last closing price for Burford Capital was 549p.
Burford Capital Limited has a 4 week average price of 508.20p and a 12 week average price of 415p.
The 1 year high share price is 987p while the 1 year low share price is currently 251p.
There are currently 218,649,877 shares in issue and the average daily traded volume is 530,998 shares. The market capitalisation of Burford Capital Limited is £1,221,378,212.92.
12/7/2020
22:06
stockvalue: Main points Burford Capital, the market leader in litigation finance, is 80% off its highs. Simply put, the market has never gotten over the fraud allegations made against this firm last summer. As a result, the shares change hands at 4x earnings and .66x book value. However, Burford is a compounder and deserves to trade at 2-3x book. In which case, the shares are worth 5x their current price. Background Burford is a litigation finance firm. It funds lawsuits and then gets a split of the proceeds. The firm handles only commercial litigation, so it isn’t involved in matters of personal tragedy, such as someone suing a hospital over the loss of a loved one. The historical economics of the business are incredible. Burford’s 10-year IRR on their concluded cases is 30%. Excluding Peterson, the firm’s homerun investment, the IRR is 24%. Add in income from Burford’s other businesses to that 24% IRR, then net out opex, taxes and interest, and you have a security with 20% ROE. At .66x book, that’s a 30% annual return to investors. But that’s only half the story. The company is growing book value 15-20% a year. By 2021, book value will likely be at least $10/share. A company with 20% ROE and strong growth deserves at least a 2.5x book multiple. That would make the shares worth $25 a share in USD or £19.50 in GBP, 5x today’s price. In terms of earnings, that would be a 14x P/E. And this assumes that IRRs going forward are 24% instead of the 30% they’ve been in the past. There’s also another factor that investors have ignored. Litigation isn’t levered to the broader economy the way almost all other companies are. In fact it’s countercyclical. IMF Bentham, another public litigation finance firm, put up record results in the wake of the financial crisis. Burford is poised to do the same. Except unlike IMF, which compounded only its own capital back then, Burford can do this both on its own capital and on the $2.8 billion it manages. This situation exists because a cloud hangs over Burford in the form of a short thesis published in August 2019 by Muddy Waters (“MW”). MW largely focused on attacking management’s credibility, which it accomplished with at best mixed results. However, the real scare factor from MW was actually a totally valid point. Burford uses Level 3 accounting, so as investors, our lives are in Burford’s hands. But, contrary to MW’s argument, the fact that Burford uses Level 3 accounting should come as a surprise to no one. Most of the firms in the space mark to fair value. Litigation finance is basically private equity but with a two-year time horizon instead of ten. Level 3, in this case, is also useful to investors. Without it, returns will look depressed relative to reality because the firm is growing rapidly and there’s a lag between deployments of capital and recoveries. Ultimately we view Burford in the following way. One, there’s a 10% chance the accounting is aggressive. In that case, the shares are near liquidation value. (That said, the downside is always worse than you think it is.) Two, there’s a 30% chance that ignoring Petersen and other one-offs, Burford is just an average player in this industry. If so, the shares are worth 1.5x book, which equates to 2x the current share price. Three, there’s a 60% chance Burford is the real deal and can maintain IRRs on its investment portfolio well above 20% while continuing to grow. That would make the shares worth 5x their current price. Margin of Safety Before getting into the potential upside, it’s worth looking at how low Burford’s current valuation is. Instead of trading at a premium to NAV, as one would expect with a company with strong returns, Burford trades at a 35% discount to NAV. At the current price, which is just 4x earnings, the company could write off its stake in Petersen, a lynchpin of the company, and it’d still be trading below net asset value. In fact the current price resembles forced liquidation value more than anything else. Running through some quick math, Burford has $160MM in cash, $180MM in complex strategies, and $1 billion in litigation and other investments at cost. Its stake in Petersen is worth at least $400MM, bringing the total minimum asset value to $1.7 billion. Net out the debt and the non-controlling interest, and the remaining $950MM roughly equals the company’s market cap. The market is saying there’s a real risk this business will be unable to continue as a going concern. On top of this, there are worries about liquidity and 2019’s poor results. We don't share these concerns because we think 2019's results are a one-off and because Burford's liquidity issues stem not from debt but from funding commitments, which it has the option to delay. Ultimately, though, an investment in Burford comes down to one thing and one thing only. Do we believe in the long-term economics or not? Confidence in the numbers is required or any investment, and MW’s report detonated investors’ confidence in Burford’s. However, several data points give us a range of answers as to Burford’s true underlying earnings power, and all of them make this a compelling investment. Going through the numbers case-by-case The first data point is the most important. For several years, Burford has provided the cumulative cash flows on concluded cases by vintage since the firm’s inception. This allows investors to see beneath Burford’s aggregate numbers, which is important because bad accounting is usually hidden within large aggregate figures. Significantly, because of its specificity, it’s also a dangerous disclosure for Burford to make if it has anything to hide. In total, this disclosure showed that $555MM had been invested in litigation through 2018. Burford then recovered $1 billion from these investments for an ROIC of 85% and an IRR of 30%. After MW’s report, Burford got even more granular, releasing both returns on a case-by-case basis and the fair value marks it had made in this those cases. This second disclosure showed that management’s fair value marks had been uniformly conservative. In all its material concluded cases where fair value marks had been taken, Burford realized $313 million in net profit. And prior to that realization, it had only written up those investments by $96 million. In other words, the fair value marks were only 30% of the realized profits. This, more than anything else, completely kneecaps the short thesis and shows that Burford’s successful history reflects real results, not accounting optimism. Going back to zero The next data point is the simplest. If we don’t trust Burford’s marks, then there’s an easy way to correct for this. We just deflate the carrying value of their investments to cost and then look at the returns using only realized gains. When we do this, we find that from 2014 to 2018, returns on investment were 22% a year. Not 30% a year, like their published IRR number. But it was never going to be 30% because they’re growing investments rapidly and returns on investments have a 1.5-2 year lag. This is in line with what you’d expect. The next question is: could they be manipulating their net realized gain figures? Could they be treating returns of capital as returns on capital? The way to answer this is to look at ROIC, which keys off total cash recoveries rather than relying on management to allocate recovered money between profit and basis. Incidentally the method we just used above allows us to do exactly that—to back into their ROIC figures. Comparing investments at cost to total realizations with a two-year lag, we get an average time-weighted ROIC from 2012-2018 of 81%. Almost identical to management’s dollar-weighted figure of 85%. We find this exercise useful because it uses independent numbers which management hasn’t cherry-picked and which are very difficult to manipulate. Mismatch between cash earnings and “Capex” The next data point also concerns Burford’s net realized gains, which from a cash flow perspective are important because they represent the company's non-fee cash earnings. Burford has announced that 2019 results will be down from those in 2018. Net realized gains are expected to be roughly $130MM when they ought to be almost double that. Renewed worry has been sparked that the cash earnings will never show up. However, this ignores the business’s inherent lumpiness. This also ignores the large mismatch between cash returns and cash deployments. Looking at the sources and uses of the company’s cash, when you add up investment recoveries, equity issuance and debt issuance, the company has had $2.5 billion in cumulative source cash flow since inception. Net out the $640MM from debt issuance, and you see that all the CF that belongs to shareholders, $1.8 billion, has gone into additions to investments. Burford’s asset growth has been exponential. Moreover in recent years this growth has keyed off substantial absolute figures. In 2015, for example, the company had just $250MM in investments at cost. Whereas today it has $1.2 billion. That’s a 50% CAGR on hundreds of millions of dollars. And it’s a 50% CAGR on assets where the stated average duration of 1.5-2 years is misleading. Why is it misleading? Because the variance around that average is massive. In 2014, cash returns on investments (at cost) were just 7%. A terrible result. This firm ceases to exist if it has 7% IRRs. Yet in the three years afterward, the company put up huge cash returns: 29% in 2015, 19% in 2016 and 35% in 2017. Ultimately looking at the cash tells us what the Level 3 accounting does not. It tells us that the dispersion on Burford’s underlying earnings is large. So it’s low-percentage to judge this kind of firm by one or even two years of results. The firm can only be judged by three to five year results. And when we look at those on a cash basis, the business is putting up returns that make it worth multiples of book, not 65% of book. Precedent for Burford’s performance The next and final data point concerns IMF Bentham, another public litigation finance firm. IMF Bentham has been in business for twice as long as Burford, and its fundamentals demonstrate the strong economics that established players in the industry can earn for long periods of time. From 2005 to 2019, IMF’s ROE averaged 15% a year. Performance of the company’s shares reflected these superior numbers. Since 2005, when the shares were trading at book value, the stock has returned 15% a year including dividends. If you waited until the shares had fallen to .66x book value in 2006, then the shares went on to return 22% a year for the next 13 years. Burford is also trading .66x book, which implies 22% returns if it enjoys a similar “fate.” Equally interesting, the years in which IMF really blew out its ROEs were in the wake of the financial crisis. IMF’s ROE jumped to 36% in 2008 and peaked at 49% in 2012. As a result of the coronavirus pandemic, Burford is on the doorstep of a similar situation. Whatever Burford’s true baseline economics exactly are, they are likely to get even better. Putting it all together Ultimately, fear about Burford’s accounting seems vastly out of proportion to the actual risk. Meanwhile that risk doesn’t really seem to be that this company is a fraud. Instead the risk is that the company might not live up to its historical economics. And in that case, if ROE is 15% instead of 20%, then it’s merely worth twice where it’s trading. However, if it can even partly live up to its historical numbers, then the upside here is huge. Unlike IMF Bentham, which only ever grew modestly, Burford is a far more ambitious firm and vying for a far larger slice of the litigation finance pie. In eleven years, the company went from nothing to the market leader in the space. It made savvy investments in claims like Petersen, Eton park and Teinver. It’s also the leader in the next phase for the industry, which is risking less of your own capital and gaining synthetic leverage by managing other people’s. The company has funds with $2.8 billion in AUM, only a portion of which has been deployed, meaning fee income is understated. It also has a relationship with a sovereign wealth fund where Burford puts up 40% of the capital and gets 60% of the returns. Burford’s balance sheet investments make it an interesting investment in its own right. But given its asset management business and its countercyclicality, it could put up incredible numbers in the near future. Valuation In order for Burford to keep IRRs at 30%, it has to find another homerun like Petersen. A far less demanding assumption is that going forward, they achieve the 24% IRRs they earned ex Petersen. That translates into 20% ROE. Book value is on pace to be at least $10/share by 2021. At 2.5x book, the shares would be worth $25/share in USD or £19.50 in GBP. That’s 5x today’s price. Meanwhile if the company can keep growing while maintaining IRRs, then that only adds to the upside. This is one of the few businesses in the world that could be worth 10x in seven years, no matter what happens in the global economy. I do not hold a position with the issuer such as employment, directorship, or consultancy. I and/or others I advise hold a material investment in the issuer's securities. Catalyst I can't put it better than the analyst who said that for a firm dogged by accounting questions to list in the US, where its management team will be subject to criminal liability, certainly shows if nothing else "self-belief." The real catalyst isn't the US listing though. It's realized gains catching up to deployments. That's where the rubber meets the road. Edit: -> Note: This is not my (stockvalue) research. The author is anonymous.
04/7/2020
10:00
lomax99: Paul Scott's comment yesterday on Manolete on Stockopedia mentioned Burford:Final Results - I've not come across this company before. It floated in Dec 2018, and seems to be involved in litigation financing. Graham outsourced coverage of it to subscriber abtan who wrote an interesting piece on it here on 21 Nov 2019. Reading that piece, it's clear that this share is not of interest to me, and I'm not interested in ploughing through loads of details on individual cases in order to work out what the shares might be worth.Having a quick skim of the results today FY 03/2020, the headline numbers look good - adjusted (for IPO costs) PBT up 40% to £9.5m.Final divi doubled to 3p (a very low yield though). Outlook statements reads positively.My main worry with this sector (as some readers have commented on below) is that short sellers attacked another, larger, litigation funding company, Burford Capital (LON:BUR) and the share price has never recovered - currently sitting at about 500p, still about 75% down from its peak. I remember listening to the conference call from Burford when it was fighting the shorting attack, and it struck me how many potential problems there are with estimating the outcomes of cases, realised/unrealised profits, selling fractions of cases just before the year end to establish a higher book value, etc. It sounded an absolute minefield. The more information Burford provided, the more questions it seemed to stimulate.According to the StockReport, Burford seems to currently sit at a Price to Tang.Book of about 1, which seems a sensible valuation to me. The equivalent metric for Manolete is 7.2. The latest balance sheet as at 31 Mar 2020 only has net assets of £34.9m, a P/NTAV of a very high 6.8 times. Looking at the list of its RNSs, I don't see anything that suggests it has done a placing since the year end, so the balance sheet would still be similar now.Clearly the business is being valued on a multiple of earnings, and net assets are largely being ignored. Whereas the short sellers smashed up that valuation basis for Burford, and hauled it down to a P/NTAV of only 1. What's to stop them doing the same thing with Manolete?My opinion - good luck with it, but this is not a sector I would want to invest in, given what happened to Burford.
24/6/2020
10:41
simso: More likely the share price fall is down to the wider market, with FTSE down -156 as I type. We always seem to get clobbered on "down days". In a rational world, Mr Market would understand full that we are counter-cyclical..and it would be more logical for BUR share price to rise when the wider market sells off on increased pessimism. However, as the whole Muddy Waters debacle of the last year proves...the market is not entirely rational, and for extended periods of time.
23/6/2020
14:56
stentorian: For those not listening to the Investor Call. Interesting insights into YPF. Sovereignty issue has now been won by Burford. The next stage is to deal with the breach of contract aspects of the case. He characterises Argentina as a well known "bad actor". When YPF shares were floated on the NYSE the prospectus set out very generous buy out calculations to deter Argentina becoming a "bad actor". Chris Bogart estimates the remaining issues will take c. 1 year to judgment. However, there is the possibility of an appeal which could take a further year. BIG HOWEVER, if Argentina proceded to appeal he feels that Argentina would have to post a bond equivalent to the judgment amount. Bogart seemed skeptical that Argentina would go down this route. Judgment interest rate. Confirmed would run from 2012 to say 2021 rate of interest of 9% in New York. The rate of interest would form part of the case. Post judgment interest is at a lesser rate to 9%. Short attack. Burford's client base and business was not affected by the Muddy Water's short attack. "Only" shareholders who were holding shares in mid-teens were affected by the effects of the short. As he business wasn't affected in time the share price will recover. US listing Chris Bogart says that if there was any dodginess in the Burford business he would have to be stupid to operate in the US as he is taking on personal liability. 3rd party funding Burford - not affected by Muddy Waters debacle. No new fundraising when there is min. 18 months of life left in earlier raisings. Future Grow and evolve innovation in the litigation finance market. Dividends Capital taking away from growth, better to recycle capital into the business. Company is not mature - therefore no returns of capital. Competition Competitors cannot compete with Burford as Burford is effecting $30m plus deals. Other competitors are not in this ballpark. Bogart welcomes new entrants as it broadens the market. Note ends.
12/5/2020
16:03
maddox: Looks like MW's latest short attack has not been damaging to the share price. >>Firstly, the report doesn't pass the 'so what' test. >> Secondly, it hasn't been accompanied by the aggressive share price manipulation as did the first short attack. They probably don't want to embarrass the FCA - whom contrive to turn a blind eye to share price manipulation. The new MW claims are unpersuasive. For example, the $20.6m 'unexplained income' that MW decides to knock-off the 2019 operating profit. It's part of a $51.4m income figure that comes from BUR's share of the Strategic Value fund - through which BUR and external partners pursue their 'complex strategies' litigation. This is also clearly declared as a Level 3 fair value movement. So it is fully explained; it is a revaluation based on a judgement of in-progess cases' value. You may not like the fact that Burford do not disclose the detail on live cases, for pretty obvious reasons, and you may not like International Financial Reporting Standards (IFRS) required fair value accounting - but that's not 'unexplained'. It appears Mr Market is starting to work out whom is obfuscating here.
24/3/2020
14:39
jeff h: Berenberg upgraded Burford Capital to 'buy', arguing the litigation finance company's shares had fallen too far. Burford's shares have plunged, valuing the company at $800m compared with $5.5bn at its peak in 2018 and its bonds are yielding 10-13%, Berenberg said. "While there are reasons for Burford's equity and bond prices to have declined, the shares have now fallen too far," Berenberg said. The broker upgraded Burford to 'buy' from 'hold', kept its price target of 810p on the shares and did not change earnings estimates. The reasons for the steep decline are lack of confidence with Burford's "markto-model" accounting using management judgement and a liquidity problem, the broker said. Berenberg's Donald Tait and Alex Medhurst said at the current price Burford's accounting prudence was not very relevant because its shares have fallen below most measures of its net asset value. The reported NAV is 616p compared with the 313p share price at the time of writing. Excluding various items including capital invested in Petersen Group's case against Argentina's government NAV is 13% below the market price. "This valuation would effectively imply no returns to the balance sheet portfolio beyond the return of capital, a complete loss in Petersen and that the other businesses (asset management and asset recovery) are worthless," the analysts wrote in a note to clients. Liquidity should be enough because Berenberg has sources of cash and "levers to pull" to meet short-term obligations, the analysts said. "Furthermore, the next bond maturity is not until 2022, and although Burford has talked about raising more debt, it has been doing so for the last 12 to 18 months and has reported a flat cash balance over an incredibly quiet H2," they said. Burford has been under pressure since US research firm and short-seller Muddy Waters accused the company of "egregiously misrepresenting" its returns and "the state of its overall business" in 2019. Burford has said Muddy Waters' claims are false. Https://www.sharecast.com/news/broker-recommendations/berenberg-upgrades-burford-capital-to-buy--7396864.html
31/1/2020
11:26
maddox: Hi hazl, As you've only recently come on-board you may have missed a few things. Burford have responded in detail to MW, the primary docs are: hTTps://www.investegate.co.uk/burford-capital-ltd--bur-/rns/response-to-short-attack/201908081245314390I/ hTTps://www.investegate.co.uk/burford-capital-ltd--bur-/rns/briefing-on-fair-value-and-return-computations/201909230700092012N/ and they have made changes on the governance issues that were raised. So, I really don't think that there is much more they can do on this front? A NY exchange listing will drive demand, as there is no intention to issue new shares, this should lift the share price. I've heard a number of analysts say that US investors will find Burford highly attractive and have a greater risk tolerance than UK investors. However, I understand it typically takes 4 - 6 weeks to go through the process and as their 2019 audited accounts are to be part of their submission to the SEC - this won't start until April. Burford report their 2019 Results on the 24 March. The H1 results were excellent and there is nothing I can see to suggest H2 will be any different. The other listed players in the market Manolete Partners (MANO) and Litigation Capital Management (LIT) have positive outlooks. I expect to see a trading update from MANO mid-Feb and LIT's H1 results early March - so we'll get some earlier comparatives. Nevertheless, I don't expect the share price to bounce back to pre-MW levels on the results - even if sparkling - but should mark the beginning of the recovery. Regards Maddox
30/1/2020
13:31
donald pond: As well as Woodford and Barnett, there is another angle to why BUR was a great target for shooters. Around a year ago I read an article saying that BUR was the only company on the market where every institutional investor in it had an outsize position. What does that mean? Effectively, that BUR represented say 0.1% of the investable universe for funds, and every fund that invested in BUR had invested more than 0.1% of its assets here. Everyone who kicked the tyres at BUR either wanted a big slice of it or none at all. Nobody had a "token" holding. As a result, when the price started slipping, and when the shorting started, everyone that held was under pressure to explain why they had a holding well ahead of the benchmark. There were very few people around to buy more: those who didn't buy in the first place felt vindicated and those who held were under pressure to sell. But the result is that the current share price has absolutely nothing to do with the company: a company that began their results with the 2 following quotes Sir Peter Middleton, Chairman of Burford, commented: "As Burford approaches its tenth anniversary, we have unbridled optimism about the future. The industry continues to grow rapidly, due in large part to the pace we set by evolving our products and services to meet the increasingly diverse demands of the users of legal finance. Burford is well positioned to continue to lead the global legal finance industry through the next decade of growth. The Board is grateful for the continued support of our all of our stakeholders." Christopher Bogart, Chief Executive Officer of Burford, said: "Burford has had a momentous first half, with profits exceeding $200 million and assets surpassing $2 billion for the first time..." Of course, you can dismiss it all as BS, as Muddy Waters did. But I think the crux of their approach - which was very well thought out - was psychological. They identified a company which was unusual, with an unusual investor base made up of PIs who were generally sitting on big profits, institutions with outsize positions, and Woodford and Barnett, who were both selling down. And they asked a simple question: not whether the company was overvalued, but rather, if they could muddy the waters, and did start hitting people's stop losses, who would buy? But while that tactic was exactly right, it also means that the disconnect between the reality of the company and the share price is stark. The challenge now is for Burford to attract the new buyers, which is I think part of the reason why getting a US listing is so important.
03/1/2020
01:32
galatea99: Long read just published in Chronic Investor on fair value accounting. Burford mentioned. Extract: "Materiality, however, bursts from the fair-value gains recorded by Burford Capital (BUR), an Aim-quoted Guernsey-headquartered company whose role is to provide the finance for civil litigations and take a slice of the settlements. As Table 2 shows, in 2015 Burford’s fair-value gains were a comparatively-modest $22m out of $77m operating profits, or 29 per cent. By 2018, such gains contributed $230m out of $344m of operating profits, 67 per cent of a much bigger total. The basic concerns are twofold. First, Burford’s fair-value gains stem from level-3 valuation methods at their most unobservable. As Burford itself says about valuing the possible pay-offs from legal cases, “the estimation of fair value is inherently uncertain. Awards and settlements are hard to predict. . . There is much unpredictability in the actions of courts, litigants and defendants... There is little activity in transacting investments and hence little relevant data for benchmarking.” "Obviously, Burford’s internal valuations are checked by its auditor, the London office of Ernst & Young. For every case where there is a year-on-year change in fair value, the auditor says it tests and challenges management’s assumptions, does external research and compiles relevant secondary-market trading data, such as exists. For cases where there is no change in value, the auditor does much the same but for a sample of cases. That sounds fine. Yet, much like the ways that Burford comes up with fair value in the first place, it’s hard to know from the outside what that really means in practice. The second, and connected, concern is that Burford’s accounting profits – swollen by paper fair-value gains – contrast sharply with the rate at which cash leaves the group. In 2015, while the group recorded operating profit of $77m, its operating cash flow was minus $9m. By 2018 compared with operating profit of $344m, the cash outflow was $198m. Cumulatively in the five years 2014-18, there was a $1.2bn divergence between accounting profits, which relied heavily on fair-value gains, and cash outflows, which removed the paper gains. True, all may yet come good at Burford, though the pace of its share-price decline – at 717p, it’s down 65 per cent from its all-time high in mid 2018 – suggests otherwise. Perhaps more important, Burford prompts the thought that fair-value adjustments – great in theory – actually cause more problems for investors than they solve. If so, that would be because, at worst, the effects of IFRS 9 and IFRS 13 turn company accounts from a precise record of past transactions into glorified speculation about the outcome of future events. Not just that, but such speculation would be strongly influenced by each company’s own bosses. Paradoxically, that would tend to have the opposite effect to what accounting-standards setters wanted when they shaped the fair-value rules. It may make equity investment less efficient because values, rather than being shaped by scores of (mostly) independent financial analysts, would, in effect, be handed down by one or two company insiders. What would be fair in that? " Https://www.investorschronicle.co.uk/shares/2020/01/02/fair-but-for-whom/ (Not a holder).
09/12/2019
19:55
galatea99: "Burford chief executive fears Argentine reprisals Chris Bogart tells US court he fears for safety if $1bn case is moved to Buenos Aires" Https://www.ft.com/content/bf17f624-1aa3-11ea-97df-cc63de1d73f4 "Burford Capital’s chief executive has told a US court that he could be threatened or imprisoned by the Argentine government if a $1bn court case were moved to Buenos Aires. “I do not put it past the Argentine government to attempt to imprison me or otherwise menace me,” said Chris Bogart, who co-founded Burford, in a legal declaration to a US court late last week. “Neither I nor other members of the Burford team would be able to participate in proceedings there given concerns about our safety.” The litigation financing company is pursuing the South American nation on behalf of Petersen Group, an investor that went bust when the government nationalised oil company YPF in 2012. Burford has valued its total stake in the case at $1bn. A US court ruled in September 2018 that Burford’s case could go ahead in the US, but Argentina has challenged the decision on jurisdictional grounds. Mr Bogart said he had warned his family and Burford employees of the risk of travelling to Argentina. He said: “Argentina will not hesitate to use tactics outside the four corners of this litigation in an effort to avoid responsibility for its actions [which] heightens my concern about personal safety.” Burford initially invested $18.4m in Petersen’s claims against Argentina and has so far made $236m by selling parts of its stake to third parties. The Aim-listed company, which is the world’s largest litigation funder, is resisting Argentina’s jurisdictional challenge. Mr Bogart admitted that sending the case to Argentina “would hobble and perhaps destroy it”. Burford’s $1bn valuation in its Petersen stake was attacked by short-seller Muddy Waters this summer, which accused the financier of “pulling forward” returns while not accounting for accompanying obligations. Burford is still reeling from the Muddy Waters report, which alleged it had misled investors by overstating the value of the cases it was funding and criticised its accounts and management. The report slashed Burford’s share price almost in half. Burford defended its accounting methods as “reliable and judicious” and has claimed to have found evidence that trading of its shares was illegally manipulated around the time of the report’s publication in August. It has since disclosed the extent to which its performance hinges on the Petersen case. Burford said in September its return on invested capital spanning all of its investments stood at 98 per cent but acknowledged that this would fall to 59 per cent if its Petersen claim were stripped out. Burford’s internal rate of return would fall from 32 per cent to 24 per cent, it said. Argentina’s Peronist party, which was in power at the time of the expropriation of YPF’s assets in 2012, returns to power on Tuesday amid fears among investors of a deterioration of relations with the private sector. A spokesperson for the incoming government did not comment."
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