IMF Bentham Europe have recently launched in the UK via a joint venture with hedge fund Elliot Management Corporation. As long-established funder with their roots in Australia, IMF Bentham may prove to be an exciting addition to the UK market.
So what does the launch mean for UK law firms? The funding market in the UK is fairly well capitalised already, with many of the existing funders struggling to find deals that work on their economic models. That being said, clearly credible capacity should always be welcomed from a competition perspective, particularly as departures from the market can and do occur (e.g. Argentum). Furthermore, IMF Bentham’s parent company’s experience in Australia should help to ensure they became one of the main players in the UK.
Competition within the UK litigation finance market has significantly intensified for larger cases in the past 12 months. Any lawyer involved in a case which needs somewhere between £500k-£5m+ of funding should recognise that there are at least 6 domestic funders with significant funds behind them that are capable of offering terms, in addition to a wider pool of international litigation funders.
The pricing variable between funders can still be wildly unpredictable on any given case. At TheJudge we’ve seen a large number of cases that require at least £4m+ of funding. However, crucially all of those cases, which had more than one interested funder, resulted in a price variable of at least £6m in net cost to the client. In some of our larger cases we’ve actually seen variables exceeding £50m. There really is no excuse for a law firm not to be considering multiple funders on any given case, unless of course that’s the client’s wish (which seems unlikely given the savings that can be made). The only wriggle for law firms is navigating around exclusivity options, which a number of litigation funders still insist upon – see our previous blog in this regard: http://www.thejudge.uk/news/the-dilemma-of-exclusivity-periods-when-arranging-arbitration-financing
If you have a case in need of funding, please do not hesitate to contact one of our team: Info@thejudge.co.uk or tel: (0)845 257 6058