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Laxman Pai, Opalesque Asia: Global finance and asset manager Burford Capital Limited announced its new $360 million Burford Advantage Master Fund.
According to a media release from the asset management firm focused on law, the Advantage Fund focuses on lower risk, lower return pre-settlement litigation investments than we include in our core legal finance portfolio, targeting matters expected to produce returns in the 12-20% IRR range.
The litigation financing provider said the fund fills the gap between the Burford Alternative Income Fund, which focuses on lower return post-settlement investments, and Burford's core business.
The Advantage Fund has a structure that rewards Burford more than traditional fund models for producing good performance: the fund does not have a traditional management and performance fee structure, but instead provides the first 10% of annual simple returns to the fund investors while Burford retains any excess return.
Based on our internal modeling, Burford does better with this approach than a traditional "2 and 20" fee structure once its returns exceed approximately 13%.
A range of institutional investors made commitments in the aggregate amount of $300 million. Burford has made a 20% commitment, or a further $60 million. The Advantage Fund's investment period runs until December 24, 2024, with a multi-year harvest period thereafter under an American waterfall.
Christopher Bogart, Burford Capital's chief executive officer, ...................... To view our full article Click here
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