Member Info for Forensic505

Jammy

You are joking right? If you think that constitutes anything close to a coherent business plan with a serious business manager then you should seriously give up investing on your own account and hand your savings to a professional fund manager. I am doing you a real kindness here.

Very clear from the budget that the economic support measures are now being phased out otherwise national debt is unsustainable of course:
1. Furlough being tapered off and then fully stopped completely by Sept
2. CBIL and CBLIL now stopped
3. Rent, rates and tax deferrals all being tapered off over next few months

Very clear message. The hope for the future is new businesses in new growth sectors. Obviously they (and no one) wants a cliff edge of insolvencies (even Mano would find that too much to handle) so a phased withdrawal is the perfect and very responsible scenario. IMHO any SP weakness is an opportunity here but DYOR of course and GLA

Hi Jammy,

Rosenblatt - who I dealt with a lot in my working days, is very highly dependant on Ian Rosenblatt. He has fantastic connections but the caseflow is very dependant upon his shoulders. Which is presumably why he can keep demanding £1m pay-offs despite selling his business.

Convex has missed all targets and they are being paid on an eat what you kill basis. Strange as similar business in K3C seems to be doing really well.

I did some background on Tets Ishikawa. Most famous in the City for strip bars, recreational drugs and fast cars. He did a book on it apparently. He then tried setting up a number of litigation funding businesses, all of which failed e.g. Sparkle didnt shine too brightly. Watching the video today the CEO ended up admitting at the end that they are really just "seeding" Lionfish. Doesnt sound like she has much belief in it anymore. It wont be in the "group" in 24 months time, closed or quietly shuffled off.

The CEO is daughter of racing driver. He owned Brands Hatch and gave it to her.

You should do some research yourself, amazing what you can find.

Just watched their presentation on Litigation Funding.

They have obviously tried and failed to "eat Manolete's lunch" and admitted they cannot replicate that model. They now seem to be aiming at the small end of of Burford's market. That is an incredibly difficult space - see their own slide on Augusta (the number 1 player in that segment in the UK), they have been working that area for 4-5 years now and are still heavily loss making. Litigation is a long tail and expensive game - you need a big balance sheet and tonnes of cash, like Burford (who are the real masters of the global litigation market). So why not just invest in Burford if you want exposure ?

More important for MANO are the temporary measures contained in the Corporate Governance and Insolvency Act June 2020. Those measures made forcing insolvency processes on companies and individuals (Winding Up petitions and Statutory Demands by creditors) almost impossible during Covid. That is the major reason for the sharp decline in insolvencies - the Company can kick the insolvency can down the road. Those “temporary measures” were due end in December and then extended to 31 March 2021.

Many thanks Ian

Can someone please explain what the "uncrossed trade" is ? Many thanks in advance.

Meh...

You look through the records and Faulkner put some seed money into this back in 2008. He has never had any operational executive role in the business whatsoever. A “shareholder director”. 13 years later he is selling. Big deal.

Great article, thanks for sharing.

I agree BigBoo. Long way to go here.

Edwina: couldn’t agree with you more. Best of luck

PE Ratio of 166x...for a regional solicitors firm...really ?

Completely agree BooHoo2. This has been laid on a silver service platter by the management who have done a tremendous job explaining the opportunity here....if only people would read things properly rather than knee jerking like jammy little sheep!

Feeks - dont get me wrong, I like the model. Its just the valuation. If you were struggling to justify 30x PER then 49x....!

Only point I dont agree with is reference to Magic Circle profits - completely different sector dynamics. Like comparing the profitability of Manchester United to Rochdale.

PER 49x for a law firm....really ?

Thanks as always Gallmat

8% - 13% cost of $50m facility looks very poor compared to Mano.l RCF facility of £20m which is just 2% also over 4 years and they dont have to deploy everything in just 2 years (that also worries me with the LIT facility). And where is this new fund promised last year...we are nearing March ! The management explain the business opportunity very well (they look like really clever guys) but starting to question the execution here. Hopefully clearer when the results come out soon.

Drinvest: dont get me wrong, I am a fan and have been a holder on multiple occasions but it is not as simple as that. If Petersen fails or fails to pay then the write off would wipe out two years of profits. Or put another way, several years of past profits were not what they were presented as.

Key message (among many at a very impressive and very open presentation last night) was: the business is doing well, in terms of profit and cash. Just not the 100%+ growth rates that we have enjoyed in recent years. All down to the artificial state of the economy while the Government protects for mass unemployment. Perfectly sensible and very clear. Reality will catch up sooner or later and the stunning out-performance should resume. The "profit warning" was against very high broker forecasts and nothing to do with the underlying excellent performance of the business. Worth a watch once ShareSoc release the recording.