Burford Capital shares surge on ruling in YPF case

Asset management firm Burford Capital was upbeat on the finding of liability against Argentina in the YPF litigation on Monday, with “substantial damages” expected to be awarded.

The AIM-traded company said the ruling pertained to the summary judgement motions filed in the US District Court in the Southern District of New York, in the Petersen and Eton Park cases, against the Republic of Argentina and YPF.

It said the court found that Argentina was liable for failing to make a tender offer for YPF shares in 2012, while YPF was not held liable for failing to enforce its bylaws against Argentina.

The court also rejected Argentina's arguments to reduce its damages liability, which would be determined after a hearing to resolve two factual issues.

Burford Capital described the ruling as a “complete win against Argentina” in terms of liability, with “substantial damages” yet to be determined, and a loss against YPF.

It noted that no additional damages would have been payable had YPF also been found liable.

“We have been pursuing this case since 2015 and it has involved substantial Burford management time along with the dedicated engagement of a team of some of the best lawyers on the planet from multiple law firms and world-class experts - going up against very good lawyers, and winning,” said chief investment officer Jonathan Molot.

“Burford is uniquely positioned to pursue these kinds of cases and secure wins for clients and substantial returns for shareholders - not only because of their size and scale, but because of the internal and external resources we can uniquely bring to bear.

“There is no aspect of this case, from strategy to minutiae, that did not involve an experienced Burford team spending many thousands of hours getting to this point.”

Molot said the case represented “what Burford is all about”, and exemplified its contribution to the civil justice system.

Chief executive officer Christopher Bogart added that in its recent shareholder letter, Burford referred to the YPF-related assets as one of its “four pillars of value”.

“I'm pleased to see this significant step forward and the value it could create for our shareholders.

“The ruling is a major milestone for Burford and we continue to see momentum in our overall portfolio and continued demand for our capital and services.”

At 0817 BST, shares in Burford Capital were up 41.94% at 1,070.92p.

Reporting by Josh White for Sharecast.com.