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so the Suncorp Class action has just been approved by the courts for settlement. Do LIT bother releasing news to this effect or is this one non-material?
https://www.supremecourt.justice.nsw.gov.au/Documents/Class%20Actions/Suncorp%20Super%20-%20Quirk/55_Judgment.pdf
Some background on the Amazon case:
https://www.theregister.com/2022/10/20/amazon_uk_buy_box_tribunal/
It is the harvard endowment fund. They are very sophisticated. It came out in past interviews.
Only certain pension funds have some of their assets in instruments that had a margin call because if this mess. Apparently this is very UK biased too, due to the type of pension.
One of the largest pension funds that have invested in LIT fund is a North American one - I seem to recall it was a teachers pension fund that has put money into both funds.
Pension funds understand their liabilities decades in advance based on members age , retirement age , mortality rates, this does allow them to tie up assets for a period of time (exactly what they do when buying 30 years bonds).
An LIT fund would be seen as higher risk for a pension fund as the sum invested isn’t guaranteed (bonds more or less are, property has historically been stable over the long term) and this is where their track record on returns is important.
Not entirely clear what the lawsuit is about - is it over compensation for illegal mining? Anyhow, today's announcement taking on Amazon should raise LIT's profile, though I wonder about the prospects for success.
check this one out. One of the cases we are funding:
https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02582533-6A1115501?access_token=83ff96335c2d45a094df02a206a39ff4
Looking at recent market and monetary policy (BoE) developments - no, they can't, in fact currently they're going through some sort of liquidity crisis and are dumping assets into already depressed markets.
Makes sense that pension funds provide capital to LCM as they can tie the money up for years easily.
Litigation Capital Management (LIT) Full Year 2022 results presentation - September 2022
LCM management Patrick Moloney, CEO and Mary Gangemi, CFO, present full year 2022 results for the period ended 30th June 2022. They delivered improved underlying performance and maintained momentum across their KPIs, while driving meaningful growth in their fund management business.
Video: https://www.piworld.co.uk/company-videos/litigation-capital-management-lit-full-year-2022-results-presentation-september-2022/
Podcast: https://piworld.podbean.com/e/litigation-capital-management-lit-full-year-2022-results-presentation-september-2022/
The Chairman just swooped up another tranche, 770k shares no less, well over half a million quid, if that's not a vote of confidence I dont know what is!
Plus the CEO picked up a not insignificant £50k+ worth, considering he already has a massive holding about 8% of the company already, he wouldnt be adding more if things were going badly methinks.
I will be following their lead and topping up as other dividends come in if the price stays under a quid.
That 100k purchase could easily be a directors buy hoovering up the stock.
Not sure why people are dumping today, especially when the basically told us the key numbers today in the last trading update rns. No surprises.
Just 99aud of net equity and we know they have a class action with settlement offer for quite a bit on the table. See posting history
So the long and the short of it is that you have a business with £57m of tangible equity that just made £4m which was less than last year even though they had much higher revenue. The drop is attributable to increased finance costs from the $50m loan and increased general costs as they grow the asset base.
They should make more than that in the next few years as the fund money gets allocated. Save for the risk that they have one big boo boo that costs them millions. Which is probably more likely now than before as they are operating in larger cases, in unfamiliar territories and with the added pressure to allocate investors money possibly leading to riskier investments. That’s not to say that more likely is necessarily very likely though. This may be an increased but still very low risk.
I’d say it looks attractively priced at £90m when you consider the LCM only tangible assets, the growing third party asset base and the historical record for compounding those assets organically.
Litigation Capital Management #LIT FY22 overview. 'Delivered improved underlying performance, maintained momentum across KPIs while driving meaningful growth in fund management business.'
video: https://bit.ly/LITfy22O
Management webinar today at 11am join here https://bit.ly/LCM_FY22_Results
Hopefully get some idea on how the new litigation funding strategy is panning out.
Whoops I meant 100m minus costs
Interesting update from Greenx making a lot of references to the recent rockhopper award.
They are saying that rockhopper were awarded about 2/3rds of their claim and will pay 20% of that to the litigation funder.
If those numbers are the same in this case, that would be about £50m to LCM minus costs.
Hopefully we do see the RNS and then a retip in investors chronicle.
The price target they had was 150p.From memory the first time they tipped it was 77p in the bargain shares portfolio but that was a couple of years back.
I would imagine they will give this a strong buy in the article.
https://www.supremecourt.justice.nsw.gov.au/Documents/Class%20Actions/Suncorp%20Super%20-%20Quirk/52.19_193556-2020.07.21-Notice%20of%20Proposed%20Settlement.pdf
page 6. we may see a RNS on 22 September.
a much bigger claim that should be getting to the end of the process is this one:
https://www.comcourts.gov.au/pas/file/Federal/P/NSD431/2020/actions
need to be a lawyer to understand all the jargon, but this could be a multi million dollar settlement. Listed peer (Omni Bridgeway) settled a claim of similar nature a couple of years ago:
https://omnibridgeway.com/docs/default-source/investors/asx-announcements/83-b-australian-class-actions---in-principle-settlement
Time to completion is not a worry for me as the contracts increase the return with time.
What i am less keen on is the number of cases going to final hearing. In the past 93pct of cases did not make it to a hearing they were settled.
It could be that the settlements are reqched towards the end but this is not clear to me.
The case to watch i think is queensland power. In an interview patrick stated 25pct return and they were going for 1billion aud. Reality would be much less i think but it could be a company maker
All seems to stem from the RNS that whilst revenue expected to be up 25% the time to completion has grown quite a lot.
I wonder if people have viewed this as an opportunity cost now and pulled funds out to put in elsewhere during the recent rally?
More than $14m paid to the litigation funded with the settlement amount to be approached in Sept.
Wonder if an RNS will follow this?
Bottom in for now? I can't understand why it's dropped so low.
well spotted Wobble. Thanks
Yes it was one of our cases. See point No3 on page 1.
https://www.williamroberts.com.au/ArticleDocuments/338/Notice%20of%20Proposed%20Amendments.pdf.aspx
GLA