Litigation Cap. Mgmt - Progress on portfolio of Investments

Litigation Capital Management

20/12/2022 07:00

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RNS Number : 2318K  Litigation Capital Management Ltd  20 December 2022

 

 

20 December 2022

 

Litigation Capital Management Limited

("LCM" or the "Company")

 

Progress on portfolio of Investments

 

£110 million Comet Group judgement in favour of funded party

largest ever claim successfully brought under the UK's 1986 Insolvency Act

 

Litigation Capital Management Limited (AIM:LIT), an alternative asset manager
specialising in dispute financing solutions internationally, is pleased to
announce positive progress on two investments within its portfolio.

 

Successful Judgment in investment in English court litigation

 

As announced on 23 June 2021, LCM entered into an agreement to provide a
finance facility to Geoffrey Carton-Kelly, a partner of FRP Advisory ("FRP"),
additional liquidator of CGL Realisations Ltd (In Liquidation), formerly known
as Comet Group Ltd ("Comet").  This investment forms part of LCM's Fund I
portfolio of investments.

 

In November 2022, judgment in the High Court was awarded in favour of Mr
Carton- Kelly (the funded party) for approximately £110m. This judgment is
understood to represent the largest ever (by value) preference claim
successfully brought under the UK's 1986 Insolvency Act.   The Defendant to
the proceeding has obtained permission to appeal the judgment, which will
delay the maturity of the investment, but will be paying the judgment amount
into court. This investment has been significantly de-risked from both a
merits and recovery risk perspective. The financial performance of this
investment is protected against the passage of time by way of an increasing
multiple of invested capital. The size of the investment made by LCM is within
the median range for an investment within Fund I.

 

Clarification of press report on an LCM investment

 

Following recent press speculation, the Company is providing an update on a
further Fund I investment involving claims against Poland under both the
Energy Charter Treaty (ECT) and the Australia-Poland Bilateral Investment
Treaty (BIT), which has now been heard by an Arbitral Tribunal. Following
completion of the hearing, the Arbitral Tribunal will render an Award in due
course. There is no specified date for an Award to be rendered and there is no
certainty as to what the outcome of that Award will be.

 

Revenue recognition

 

In line with LCM's revenue recognition, the Company will only recognise
revenue associated with these matters at the point in time it has more
certainty on the final outcome, including following any appeal where relevant,
or when there is more clarity around the recovery of funds. We remain
confident that with respect to the awards set out above these will generate
returns in line with management expectations, notwithstanding that, the timing
within which each award will be realised remains uncertain. The Company
generally expects the duration of investments to increase to between 36 - 42
months.

 

Patrick Moloney, CEO of LCM, commented: "We are pleased with the significant
progress on these key investments. The successful judgment in the High Court
of England demonstrates LCM's strength in project selection and we look
forward to reporting further once each of these investments has reached a
conclusion."

 

 

Enquiries

 Litigation Capital Management             c/o Alma PR
 Patrick Moloney, Chief Executive Officer

 Canaccord (Nomad and Joint Broker)        Tel: 020 7523 8000
 Bobbie Hilliam

 Investec Bank plc (Joint Broker)          Tel: 020 7597 5970
 David Anderson

 Alma PR                                   Tel: 020 3405 0205
 Justine James                             LCM@almapr.co.uk
 Kieran Breheny

 

NOTES TO EDITORS

 

Litigation Capital Management (LCM) is an alternative asset manager
specialising in disputes financing solutions internationally, which operates
two business models. The first is direct investments made from LCM's permanent
balance sheet capital and the second is third party fund management. Under
those two business models, LCM currently pursues three investment strategies:
Single-case funding, Portfolio funding and Acquisitions of claims. LCM
generates its revenue from both its direct investments and also performance
fees through asset management.

 

LCM has an unparalleled track record driven by disciplined project selection
and robust risk management.

 

Currently headquartered in Sydney, with offices in London, Singapore, Brisbane
and Melbourne, LCM listed on AIM in December 2018, trading under the ticker
LIT.

 

www.lcmfinance.com (http://www.lcmfinance.com/)

 

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