Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
I honestly don't think the share price is going to be moved by a bloke on Twitter with 19 followers and 45 total tweets. But if you do want to check him out, a little work on his profile reveals that his name is Javier Errecondo, an Argentine lawyer working in finance, his profile is here: http://www.egfa.com.ar/en/nuestra-firma/socios/javier-errecondo/
He seems to be strongly pro-Argentine Govt and has represented them on several occasions. He is quoted in a petition from 2015 as writing in support of Argentina's motion to dismiss (on Argentine law grounds) which was subsequently unsuccessful. He's also probably unwise making such remarks on a public forum.
A bit of context is important.
The confirmed deal between the IMF and Argentina for the provision of funding to resolve the growing debt situation is extremely significant. Not only will Argentina have the funds to pay down its obligations (including those arising from international court cases), but I'd be surprised if the IMF position wasn't contingent on Argentina either settling in advance or at least paying promptly any such debts. This has been the IMF stance in the past, and I would be rather surprised if the Peterson matter was not referenced in some way during these negotiations. Putting it another way, a $2bn settlement now would avoid a $4bn debt in 6 months time. And should (I'd have thought) be a resolution that both Burford and YPF are happy with.
Excellent podcast interview here of Chris Bogart. Great insight into the business and as usual, a great speaker.
https://podcasts.apple.com/us/podcast/law-disrupted/id1612309007?i=1000552718368
1. A new Numis broker note on the YPF case - very positive and a guidance share price of 2X the current one (and not far off even if no more YPF money ever results)
2. Very close to settlement on Sundance?
3. A large win announced today on the South African Steinhoff matter
4. Another decent win announced at the start of February on the HFF/JLL matter
Good times.
you cant do litigation if the courts are closed! New investments are up a record amount and the company has more investments now than ever in its history. The reason I like settlement on YPF is purely timing. I would take $1bn in the bank now rather than try to chase $3bn around the world for the next 5 years.
they've delivered IRRs of 30% every year for the past 13 years... why the constant "they need to prove it" mantra? I don't want to come across as total 'fanboy' the whole time, but I am increasingly baffled by both the current share price, and also the idea that Burford is a business which has something to prove?
TWT - it is my personal opinion that Argentina should settle. This is of course a complex concession for them but would result in significantly less financial cost, plus the ability to frame the end of this matter in whatever terms are most digestible internally. I don't think they would need to raise a bond or anything in advance of this; a payment plan would be usual, and in any case, the IMF is very close to Argentia's debt problem at the moment and will provide options if need be. IF Burford has to go down the enforcement route, then there a many options in that regard and they are excellently-placed to pursue that through their inhouse team.
Summary judgment looks like the most likely resolution, which would put us at early June. But settlements do tend to come on the courtroom steps, as they say.
https://urldefense.com/v3/__https://www.insidermonkey.com/blog/is-burford-capital-bur-a-smart-long-term-buy-1029698/__;!!LBn7KyCY!SkbG2AONnaoDBv6YV1g6URm5GSwU_lCLIPgYRCie5lDQaEc7lK43xk2_psRo30yCzwHzIx8FgaXspRKcfB7F$
Expert Discovery ends on March 11. Both sides will file their Summary Judgements on March 31. Replies are then due on May 12. Following the replies, there are the final responses on June 9. So from June 10 - we're on.
Unless of course a settlement happens before then. And don't forget - both sides requested Summary Judgment, so it would be unusual for the Judge to not follow that route.
New update from Sebastian Maril. Summary judgment expected on 10 June if it's going to proceed along those lines. The Maxus case (non Burford but also against YPF) follows later at the end of June. Both parties in the Bur/YPF matter will submit their proposed trial timelines on 2 March.
Very good episode of 'The Moneyweek Podcast' this week, including a very good explanation of why Burford Capital is so excellently placed in times such as these. Would recommend a listen. Easy to find on Apple Podcasts and the usual places. I think the Burford bit is about 40 minutes in (ish).
sorry for the delay TWT - been in the office all day today - a strangely rare occurrence nowadays!
Yes, there are widespread court delays across Europe, the US and offshore. COVID is the obvious reason, but the practical reality can range from poorly judges or lawyers, technical challenges of remote hearings and then of course court closures themselves - which vary hugely and are still very restrictive in places like Hong Kong.
I wouldn't like to generalise on timescales, but it has put a delay into the system. I have a case in NY at present which was filed in Feb 2020 and we're only just starting to get movement. On the contrary, I have a funded case (actually not a Burford one in this instance) which is on a "rocket docket" - as they're called - and which is absolutely flying through the system, much to the distress of the case teams on both sides!
In short, I'm not bothered by the delays here so far a realisations go. As I've said before, the slow process with litigation funding is actually getting cases funded in the first place (the process takes an age). This in my mind only makes Burford's record underwriting figures for 2021 all the more impressive.
Well that's not how it works as well you know - but I'm not going to waste my breath in this fight. As someone who has worked with the company for over 8 years and met the key individuals on multiple occasions (and had cases funded by them) I have nothing but positive sentiment for their business, the model and their integrity. But you carry on.
You'll also be aware that Burford's requests to see the relevant data from the LSE were denied by the court - despite significant effort from Burford's external counsel. You'll also recall that the record clearly states that Burford described the decision as ‘flawed’, and commented that ‘there is a limit to the level of effort that it is sensible and appropriate to expend, and thus Burford does not intend to appeal'.
AceOfClubs - in that period you've had the erroneous Muddy Waters paper (which has been dismantled a number of times) and the COVID market crash. The company is stronger and larger now (with many times the investments) than when the market valued it at £20 per share and a sovereign wealth fund bought in at £18. The current price represents a huge and discounted opportunity - the only variable being time. I'm not picking a fight with your assertion, but I do think the broader context is important.
The IMF helped Argentina restructure $44bn of debt two weeks ago, which includes provisions to pay down new debt that arises (with specific note to the Peterson and Maxus cases). As others have also correctly noted, any judgment would also permit pursuit of YPF as well as the State.
if the courts are closed, then you cant do litigation - it really is that simple. But they're opening up again now, so excellent. And in the meantime, Burford has funded record deployments and cases. To badly paraphrase Chris Bogart, "nothing material has happened to the detriment of our cases - it's just that nothing has happened".
It's just time.