RNS Number:4740K
Juridica Investments Limited
21 December 2007
The information contained in this announcement is restricted and not for
release, publication or distribution in, or into, the United States, Australia,
Canada, Japan, the Republic of Ireland or South Africa. This announcement is
not an admission document and is not an offer to sell, or a solicitation of an
offer to buy securities in the United States or in any other jurisdiction.
Juridica Investments Limited
Admission to trading on AIM
21 December 2007
Juridica Investments Limited ("JIL", "Juridica" or the "Company"), a
closed-ended investment company, focused on investing in litigation and
arbitration claims, is pleased to announce the commencement of dealings in its
ordinary shares of nil par value ("Ordinary Shares") on AIM following the issue
of 80 million shares at �1 per Ordinary Share via a successful placing by Cenkos
Securities plc and subscription.
Juridica, via its investment manager Juridica Management Limited, intends to
build a diversified portfolio of investments in legal claims and to provide
shareholders with an attractive level of dividends and capital growth through
investing directly and indirectly in litigation and arbitration cases, claims
and disputes.
Highlights:
- Initial market capitalisation of �80 million at the Placing Price.
- The Company intends to make direct investments in a variety of different
claims, including, but not limited to, the following:
o property damage, defaulted debt, breach of contract, insurance,
antitrust, indemnification, subrogation, environmental liability,
securities, expropriation and government taking, unregistered
intellectual property and other business claims;
o claims and interests involving registered intellectual property
(copyright, trademark and patent); and
o claims in foreign (non-US) litigation and in arbitration matters.
- The principals of the investment manager, Juridica Management Limited, are
both licensed lawyers in the District of Columbia (and other US states)
with 50 years' combined legal professional experience.
- Juridica Management Limited owns 1.5 million Ordinary Shares and Juridica
owns 15 per cent. of Juridica Management Limited.
- According to the US Bureau of Economic Analysis (BEA), over $180 billion
was spent in 2005 on "legal services" in the United States.
- Cenkos Securities is acting as Nominated Adviser and broker to the Company.
The ultimate goal of the Company is to be a leading source of value-added and
direct financing for large claims in complex litigation and arbitration
worldwide where such financing is considered to be lawful and permitted under
local law and rules on professional ethics.
Commenting on Admission, Lord (Dan) Brennan, non-executive Chairman of Juridica,
said, "Following the successful Placing, we are delighted to be admitted to
trading on AIM. We believe that Juridica is well positioned to capitalise on
the growth in the worldwide litigation market, in which management has
considerable expertise and experience in legal services. The Board would like to
extend a warm welcome to all the Company's new shareholders as we seek to build
long-term value and a platform for future growth. We look forward to reporting
our progress to the market in the coming years."
Commenting on Admission and the Placing, Richard Fields, of the investment
manager said, "The global legal market is well-developed. To date there has
been limited mechanism for the public to invest in this market and we look
forward to structuring legally and ethically sound investments in litigation. We
are delighted to bring Juridica to the market and give shareholders the
opportunity to participate in revenues from litigation."
For further information, please contact:
Juridica Management Limited
Richard W. Fields +1 (212) 277 6555
Cenkos Securities
Nicholas Wells/Simon Southwood +44 (0) 20 7397 8900
Bell Pottinger
David Rydell +44 (0) 20 7861 3232
Daniel de Belder
The Ordinary Shares have not been nor will they be, registered under the US
Securities Act of 1933, as amended, or with any securities regulatory authority
of any state or other jurisdiction of the United States or under the applicable
securities laws of Australia, Canada, Japan, South Africa or the Republic of
Ireland. Subject to certain exceptions, the Ordinary Shares may not be offered
or sold in the United States, Australia, Canada, Japan, South Africa or the
Republic of Ireland or to or for the account or benefit of any national,
resident or citizen of Australia, Canada, Japan, South Africa or the Republic of
Ireland or any person located in the United States. This document does not
constitute an offer of, or the solicitation of an offer to subscribe for or buy,
any Ordinary Shares to any person in any jurisdiction to whom it is unlawful to
make such offer or solicitation in such jurisdiction and is not for distribution
in, or into, the United States, Australia, Canada, Japan, South Africa or the
Republic of Ireland. The distribution of this document in other jurisdictions
may be restricted by law and therefore persons into whose possession this
document comes should inform themselves of and observe such restrictions.
Cenkos Securities is regulated by the Financial Services Authority and is acting
exclusively for the Company and for no one else in connection with the Placing
and Admission. Cenkos Securities will not be responsible to anyone other than
the Company for providing the protections afforded to customers of Cenkos
Securities or for advising any other person on the contents of this document or
the Placing and Admission. The responsibility of Cenkos Securities as nominated
adviser and broker to the Company is owed solely to the London Stock Exchange
and is not owed to the Company or any Director or to any other person in respect
of their decision to acquire Ordinary Shares in reliance of any part of this
document. No representation or warranty, express or implied, is made by Cenkos
Securities as to the contents of this document (without limiting the statutory
rights of any person to whom this document is issued). No liability whatsoever
is accepted by Cenkos Securities for the accuracy of any information or opinions
contained in this document or for the omission of any material information for
which it is not responsible.
Copies of the Company's Admission Document will be available during normal
business hours on any day (except Saturdays, Sundays, bank and public holidays)
free of charge to the public at the offices of Cenkos Securities plc, 6.7.8
Tokenhouse Yard, London EC2R 7AS for one month from the date of Admission.
This announcement includes statements that are, or may be deemed to be, ''
forward-looking statements''. These forward-looking statements can be identified
by the use of forward-looking terminology, including the terms ''believes'', ''
estimates'', ''plans'', ''projects'', ''anticipates'', ''expects'', ''intends'',
''may'', ''will'', or ''should'' or, in each case, their negative or other
variations or comparable terminology. These forward-looking statements include
matters that are not historical facts and include statements regarding the
Company's intentions, beliefs or current expectations such as those regarding
the Company's business strategy, plans and objectives.
By their nature, forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. A number of factors could cause
actual results and developments to differ materially from those expressed or
implied by the forward-looking statements. In light of these factors and the
uncertainties and assumptions inherent in forward-looking statements contained
in this announcement, such statements may and often do differ materially from
actual results and the events described in them may not occur. Any
forward-looking statements in this announcement reflect the Directors', the
Company's and the Investment Manager's view with respect to future events as at
the date of this document and are subject to risks relating to future events and
other risks, uncertainties and assumptions relating to the Company's operations
and strategy. Save as required by law, none of the Company, the Directors or the
Investment Manager has any obligation to publicly release the results of any
revisions to any forward looking statements in this document that may occur due
to any change in its expectations or to reflect events or circumstances after
the date of this document.
Juridica Investments Limited
Admission to trading on AIM
Background
Juridica Investments Limited is a limited liability, closed-ended investment
company registered in Guernsey. The investment objective of the Company is to
build a diversified portfolio of investments in claims and to provide
shareholders with an attractive level of dividends and capital growth through
investing in litigation and arbitration cases, claims and disputes. It is
expected that these investments will initially be made predominantly in the
United States and in international arbitration cases although, in the medium
term, the Company would expect to make investments outside of the United States
in jurisdictions where such investments are lawful and permitted under local law
and rules on professional ethics.
The Company has appointed Juridica Management Limited (the "Investment Manager
"), a new company limited by shares and incorporated in Guernsey, as its
exclusive investment manager to actively locate, select and manage direct and
indirect investments by the Company in cases, claims and disputes. The
Investment Manager was founded by Richard W. Fields and Timothy D. Scrantom, who
are both licensed lawyers in the District of Columbia (and other US states) with
50 years combined legal professional experience. Following Admission, family
trusts of Messrs Fields and Scrantom will own 85% of the share capital of the
Investment Manager, and the Company will own 15%. The Investment Manager owns
1,500,000 Ordinary Shares.
The Company intends to invest 50% or more of the net proceeds of the Placing in
direct investments in claims with the balance (after making the investment in
the Investment Manager) net of expenses being invested through loans to law
firms to finance legal fees and costs in connection with active participation in
claims (through co-counsel agreements with other lawyers). These law firms will
include Fields & Scrantom PLLC ("FSUS"), a District of Columbia professional
limited liability company owned by the Principals. The current intention of the
Principals is to create one or more other legal services entities in
jurisdictions outside of the United States to be controlled by them and lawyers
directly associated with them to which similar loans will be made by the
Company.
Investments by way of loans to FSUS and other law firms will be made when:
- a direct investment by the Company is not possible or preferred because
(for example) it is not permitted for legal or ethical reasons;
- in instances where it is not practicable to get all plaintiffs individually
to agree to a direct investment; or
- when the Investment Manager considers that better returns or results could
be achieved if a Principal or a partner of another law firm were to take an
active role in the management and strategy of a case or claim.
The ultimate goal of the Company is to be a leading source of value-added and
direct financing for large claims in complex litigation and arbitration
worldwide where such financing is lawful and permitted under local law and rules
on professional ethics.
Approximately �74.4 million, after expenses and investment in the Investment
Manager, has been raised by the Company for investment. The Investment Manager
expects that the net proceeds of the Placing can be fully deployed in
investments within the investment policy of the Company between eighteen and
twenty four months although there is no obligation upon the Company to invest
the proceeds within any period of time.
The Directors, in accordance with the AIM Rules for Companies, will at each
annual general meeting of the Company seek shareholder approval of the Company's
investing strategy. In addition, the Company does not have a fixed life.
However, shortly before the sixth anniversary of admission, and every three
years thereafter the Board will convene a shareholders' meeting at which a
special resolution to wind up the Company will be proposed.
Investment objective and policy
The Company intends to invest in a wide variety of arbitration and litigation
claims. Initially, these investments are expected to be made predominantly in
the US and in international arbitration cases through referrals from the
Principals' established network of lawyers and law firms. The investment
objective of the Company is to build a diversified portfolio of investments in
claims and to provide Shareholders with an attractive level of dividends and
capital growth through investing directly and indirectly in litigation and
arbitration cases, claims and disputes.
The Company will seek to meet its investment and yield objectives through
investing in large claims, typically where the total recoveries sought exceed $2
million. Except where specifically approved by the Board, no single investment
of the Company will exceed $10 million. Investment opportunities will be
selected using underwriting criteria which were originally established by the
Principals.
The Investment Manager will seek to achieve diversification of investments by
industry, jurisdiction, claim size and expected time-to-return, although most
investments will be long-term with an expected return within two to five years
of investment. Investments will be structured as loans when a direct investment
by the Company is not possible because (for example) it is not clearly permitted
for legal or ethical reasons, in instances where it is not practicable to get
all plaintiffs individually to agree to a direct investment, or when the
Investment Manager considers that better returns or results could be achieved if
a Principal or partner of another law firm takes an active role in the
management and strategy of a case under a co-counsel arrangement.
In the medium term, the Company intends to make direct and indirect investments
outside the United States, where it has received a reasoned, written legal
opinion that such investments are considered to be lawful and permitted under
local laws and/or rules on professional ethics. As at the date of this
announcement, the Company has not made (nor entered into any commitment to make)
any direct or indirect investments.
Investments and structures
Before making an investment, the Company intends to obtain a written reasoned
opinion from an independent appropriately-qualified law firm to confirm (subject
to customary exceptions) that the proposed investment will not contravene local
laws or rules on professional ethics.
Direct investments
The Company will use a variety of structures developed by the Principals and the
Investment Manager to enable the Company to make direct investments in
litigation and arbitration claims. These structures will be carefully customised
by the Investment Manager for each case opportunity in order to seek compliance
with legal requirements and local rules on professional ethics as well as
seeking to ensure the enforceability of the Company's direct investment
contracts and collectability of the relevant share of the recoveries.
It is anticipated that typically the Company will pay money to the plaintiff(s)
themselves, in connection with the purchase of a percentage of the case
recovery. In some instances, the terms of the investment will require some or
all of the claim purchase monies to be paid to the prosecuting lawyer to finance
the case.
The Company intends to make direct investment in a variety of different claims,
including but not limited to the following:
- property damage, defaulted debt, breach of contract, insurance, antitrust,
indemnification, subrogation, environmental liability, securities,
expropriation and government taking, unregistered intellectual property and
other business claims (''Business Claims'');
- claims and interests involving registered intellectual property
(copyright, trademark and patent); and
- claims in foreign (non-US) litigation and in arbitration
matters.
Loans to FSUS and other law firms
The Company intends to use up to approximately 50 per cent. of the net proceeds
of the Placing to make loans to FSUS and other law firms (which may include
other firms established by the Principals). The loans will not exceed $10
million for any one case (unless specifically approved by the Board) and will be
used by the law firms to finance legal fees and costs in connection with active
participation in claims pending in the US and foreign courts and in pending
arbitrations (through co-counsel agreements with other lawyers actively involved
in pursuing those claims or other financing relationships).
Dividend policy
Except in connection with the winding up of the Company, the Company is
prevented under a management agreement between JIL and the Investment Manager
(the "Management Agreement") from making a distribution to shareholders where
such distribution would result in the net asset value of the Company falling
below �80 million. Subject to this restriction it is anticipated that the
Company will distribute to shareholders biannually any profits generated from
its investments.
Investment Manager
The Company will be managed by Juridica Management Limited, a new management
company based in Guernsey. The Principals, who are the senior management of the
Investment Manager and partners in FSUS, will select and appropriately structure
investments for the Company on the basis of case analysis systems and standards
being developed by the Investment Manager.
The Investment Manager will earn operating revenues from the Company in the form
of management fees and performance fees under the Management Agreement.
Principals of the Investment Manager
The Principals are as follows:
Richard W. Fields
Richard W. Fields has been a partner in several major US law firms practicing as
a plaintiff's lawyer in the areas of complex litigation and dispute resolution.
He focuses his practice on insurance coverage issues, complex business dispute
resolution, and human rights issues. Over the course of his career, Mr. Fields
has recovered several billion dollars for numerous Fortune 500 clients whose
insurance claims have been disputed by insurers. His international insurance
coverage practice spans a wide range of subject matters such as products
liability, professional indemnity, environmental, asbestos, and directors' and
officers' insurance. His practice includes state and federal court litigation,
international arbitration, and alternative dispute resolution. In the insurance
coverage area, Mr. Fields has represented many major oil, gas and electric
companies and major manufacturers, among others. He is admitted to practice in
New York and the District of Columbia. He graduated from Indiana University,
B.A., 1977, with High Distinction, and from Indiana University School of Law,
J.D., 1982, summa cum laude.
Timothy D. Scrantom
Timothy D. Scrantom is an American lawyer and an English barrister-at-law
(Gray's Inn)(currently non-practising). A significant portion of his practice
currently centres on disputes, audits and investigations in international
finance. He also acts as a strategic consultant on legal issues in complex
multi-jurisdiction litigation and business migrations. He received a juris
doctor (cum laude) from the University of Georgia (1983) and an LL.M. in
International Business Law from the London School of Economics (1984). In the
United States, he is admitted to practice in the District of Columbia, Georgia
and South Carolina. He is also a barrister before the courts of the Eastern
Caribbean States.
Management fees
The Investment Manager is entitled to an annual management fee from the Company
at the rate of 2.5 per cent. per annum of the Adjusted Net Asset Value (the net
asset value of the Company at the relevant time, after accruing for the annual
management fee but not taking into account any liability of the Company for
accrued performance fees and after deducting any unrealised gains on investments
and adding the amount of any write downs with respect to investments which have
not been written off) of the Company at the relevant year end.
Performance fees
In addition, the Investment Manager will be entitled to an annual performance
fee, based on the Adjusted Net Asset Value of the Company for the relevant year
end, to the extent that one or more of the performance hurdle tests are met. The
performance fee will equal 20 per cent. of the annualised increase in Adjusted
Net Asset Value of the Company over a hurdle of 8 per cent., 35 per cent. of the
increase over a hurdle of 20 per cent. and 50 per cent. of the increase over a
hurdle of 40 per cent. These fees will be subject to the condition that no
performance fee will be paid if the Adjusted Net Asset Value of the Company does
not exceed the Adjusted Net Asset Value at the end of the previous year in which
the performance fee was paid, a ''high water'' mark.
Half of any performance fee paid will be held back subject to performance
conditions. Once these conditions have been achieved, this fee will become
payable to the fund manager in shares of the Company.
Board of Directors
The Board is constituted as follows:
Lord Dan Brennan, age 65 (Chairman)
Lord Daniel Brennan QC is a practising barrister who specialises in commercial
law, international business issues, public and private international law, and
international arbitration. During 1999, he was Chairman of the Bar of England
and Wales, the organisation that represents 10,000 practising barristers,
specialist advocates and advisers in litigation and in 2000, he was voted
Barrister of the Year. In May 2000, the Queen, on the recommendation of the
United Kingdom Government, appointed him a life peer and member of the House of
Lords.
John Kermit Birchfield, age 67
John Kermit Birchfield was admitted to the Federal District Court of New York
and the Court of Appeals for the 2nd Circuit and the New York State Bar and the
New York City Bar in 1972 and has over 35 years of experience in corporate
finance, mergers and acquisitions, corporate litigation and other corporate
matters. He spent the first 12 years of his career with two Wall Street law
firms. For five years in the 1980s he held the position of Senior Vice President
Legal and Governmental Affairs and General Counsel at Georgia-Pacific
Corporation (at that time, a company listed on the New York Stock Exchange) and
in the 1990s, he spent five years as Senior Vice President Legal, Secretary and
General Counsel at M/A-Com, Inc. (also then listed on the New York Stock
Exchange). Since that time, he has served on the board of a number of US
companies including HPSC Inc.(at that time, listed on the American Stock
Exchange) and Dairy Mart Convenience Stores, Inc. (also then listed on the
American Stock Exchange). He is currently Chairman of Massachusetts Financial
Services Compass Group of Mutual Funds, which has approximately $10 billion in
assets, Displaytech, Inc., SiteWatch Technologies, LLC and Dessin Fournir
Companies.
Richard Battey, age 55
Mr. Richard Battey is a non-executive director of a number of companies
including closed end investment funds and a private equity administrator. After
qualifying with Baker Sutton & Co., Chartered Accountants, in London in 1977 he
worked for the Schroder Group, initially in internal audit and as Financial
Accountant for J. Henry Schroder Wagg & Co. Ltd and then in Schroder Investment
Management in London until 1994. Mr Battey was a director of Schroders (C.I.)
Limited in Guernsey from April 1994 to December 2004 where he served as Finance
Director and Chief Operating Officer. He remains a non-executive director of
Schroder Administrative Services (C.I.) Limited. From May 2005 to July 2006 he
was Chief Financial Officer of CanArgo Energy Corporation and until end October
2006 as an adviser on the preparations for the spin-out of its subsidiary,
Tethys Petroleum Limited. He is also a director of the Investment Manager.
For further information:
Juridica Management Limited
Richard W. Fields +1 (212) 277 6555
Cenkos Securities
Nicholas Wells/Simon Southwood +44 (0) 20 7397 8900
Bell Pottinger
David Rydell +44 (0) 20 7861 3232
Daniel de Belder
This information is provided by RNS
The company news service from the London Stock Exchange
END
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