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A severely underrated track record

Simon Thompson: An impressive 2.9 times multiple on invested capital in the past 13 years points to a doubling of NAV
A severely underrated track recordPublished on December 4, 2024
  • 89 per cent win ratio since inception
  • 2.9 times multiple on invested capital in past 13 years
  • 10 times return on invested capital in recent case win

Recent news flow from Litigation Capital Management (LIT :113.25p), a provider of litigation financing, highlights the benefits of having a third-party fund management business that accentuates returns on invested capital.

For instance, the group funded an international arbitration claim brought against Poland in relation to a breach of its obligations under a treaty with Australia. The Tribunal adjudicating on the case awarded the funded party A$490mn plus interest. LCM will be entitled to six times the A$4.2mn (£2.8mn) invested from its own balance sheet, which rises to 10 times return on capital once performance fees on third-party funds are taken into account.

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