Asset Management

Investment Firm Targeting Legal Disputes Boosts Capital With Fortress Deal

Tom Burroughes Group Editor 4 July 2016

Investment Firm Targeting Legal Disputes Boosts Capital With Fortress Deal

Vannin Capital has increased its funding with a debt facility.

An investment firm making money out of commercial litigation and arbitration cases has stepped its activity up a gear. The dispute resolution funder Vannin Capital, which is based out of the Channel Islands and has offices worldwide, such as in Australia, entered a senior secured debt facility from funds run by Fortress Investment Group’s affiliates.

The new funding, combined with existing equity, increases Vannin’s capital to $500 million, a statement from the organisation said late last week. The business had $70.6 billion of assets under management as at the end of March.

Vannin, which was founded in 2010, commits finance to the cases it invests in and funds litigators and international arbitrators.

"We're seeing an ever increasing number of opportunities, particularly in Europe, Australasia and the US where our teams are based. The new facility will enable us to launch a wider range of funding solutions and expand our already large and diversified asset portfolio," Vannin chairman Dan Craddock said. 

The activity of organisations such as Vannin Capital highlights how investors, seeking uncorrelated returns and sources of yield, have turned to niche areas such as lawsuits and arbitration cases. With disputes sometimes increasing during periods of economic stress, it is argued that areas such as litigation finance are good diversifiers of risk. Another firm aiming to change the market is Burford Capital, a commercial finance provider issuing public equity and private debt. It is quoted on London’s Alternative Investment Market and legally domiciled in Guernsey, with main offices in New York and London.

With litigation finance, the provider typically funds a case in return for a share of the winnings and a specific fee (the exact level of fee and winnings percentage will vary, depending on the risk of a case, its complexity, and other factors). 

Among recent moves, Vannin, which has offices in London, Sydney, Melbourne and presences in Washington DC and Paris, has added to its team. In January, senior counsel Jeffery Commission, based in Washington, DC, was hired. He was previously senior associate in the International Arbitration Group at Freshfields in London, New York and Washington, DC. In April, the firm appointed Philippa Murphy as director of investments, based in Melbourne. She was previously a partner in the dispute resolution team and head of the Asia-Pacific risk and crisis management practice group at Baker & McKenzie.


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