Third-party funder Juridica has made a £23m profit on four separate cases that have partially settled, it announced yesterday.
In a statement, the AIM-listed company said the cash, which it emphasised is a realised gain rather than a return on capital, was in line with expectations for these cases as previously reflected in its unrealised profits. It will receive the vast majority of the proceeds at its year-end.
Juridica expects to release its half-year results in mid-September. The statement said: “As it moves further into the year and has more visibility on expected year-end results in the portfolio, the board will consider at its 6 September meeting the announcement of an interim dividend to be paid to shareholders at or prior to the year-end. It is the Board's intention to pay-out a significant part of these proceeds as dividends, as and when received.”
Juridica initially raised £115m of capital in two tranches. With the latest settlements, it has now generated £53m in gross proceeds and returned £16m to shareholders in the form of £11m in dividends and £6m when it acquired company shares in its September 2010 buy-back programme.
Lord Brennan, Juridica’s chairman, said: “I am pleased to report that we are starting to see the benefits of some of our investments in larger cases, which often have a longer time to completion but also can generate larger returns.
“The cash results announced today demonstrate the strength of our investment approach and are equivalent to 20% of the total capital raised by the company. The board and its investment manager are really pleased about this opportunity to return significant dividends to shareholders in the near term.”
Richard Fields, chairman and chief executive of Juridica Capital Management, the investment manager, said: “When we first developed this market, we committed Juridica to invest in bigger cases with a desire to generate significant returns for our investors over the long term. We are thrilled to see the results and truly hope the investors who have been with us throughout this process feel the same way.”
Meanwhile, Australian funder IMF is backing an A$223m (£150m) unfair fees action being brought by Maurice Blackburn Lawyers against eight banks in the country. With 170,000 claims, it is the biggest series of class actions brought in Australia.
The class actions are being funded by IMF on a no-win, no-fee basis for participants.