The directors of third-party litigation funder Juridica are urging shareholders to vote against a sunset provision that would see the company wound up next month.
When Juridica was listed on AIM nearly six years ago, the directors undertook to convene a shareholders’ meeting within six years to debate a resolution that it be voluntarily wound up, and this was written into the articles of association.
The cut-off date is next month and the meeting will be held on 14 November. In a recently published notice, the board argued that “there continues to be significant opportunities for the company to invest in a diversified portfolio of new claims that will generate attractive returns for shareholders.
“If passed, the discontinuation resolution would prevent future investment, including future investment in existing claims that may require incremental capital to realise their maximum value.”
In the event the resolution is voted down, the board pledged to put it again to a meeting in another three years.
Lord Brennan QC, non-executive chairman of Juridica, said: “Juridica has delivered strong returns to investors since inception. Through careful investment selection and management, the company is now in the enviable position of having a maturing portfolio of high-quality investments which we expect to deliver continued returns to shareholders. We therefore recommend shareholders vote for the fund to continue its work for the next three years.”
Juridica announced today that “following further progress in its maturing portfolio”, its board has approved a supplementary dividend of 4p per share, on top of the 10p announced in July. Gross proceeds achieved during 2013 total $30m (£19m).
Shareholders will also be asked to approve a change of investment manager from Juridica Capital Management (JCM) to Fields Capital Management (FCM), wholly owned by Richard Fields, who currently heads and is the key shareholder in JCM.
FCM will have “increased resources and capacity”, the notice said, and intends to raise new funds. Juridica will not be the sole client of FCM, and unlike with JCM, will not have a minority shareholding in its investment manager. FCM plans to change its name to Juridica Asset Management.
The news comes shortly after Juridica formed a strategic partnership with ipCreate, an intellectual property creation, acquisition and development company in the US. As part of the agreement, the company has supported ipCreate’s $7.5m fundraising by acquiring $2m in shares.
Juridica said the benefits, beyond the potential financial returns on its investment, will be “access to ipCreate and the ipCapital group of companies and their market leading tools for enhancing the company’s current and future patent and IP investments”.