janebolacha
28 Jul 2017
Article from Buenos Aires Herald This article gives a figure for the interest element of the award by ICSID in favour of Teivner/Marsans/Burford. I've no idea how this figure ($23.76m) is arrived at since it seems very low for nine years compound interest on $320m."Tribunal fines Argentina US$320M over Aerolíneas Argentinas expropriationPayout represents 20 percent of that sought by now insolvent Marsans GroupArgentina has been ordered to pay more than US$320 million to the insolvent Marsans Group over the expropriation of Aerolíneas Argentinas and other companies, closing a chapter in a saga that started in 2008.In a split decision, a tribunal at the World Bank’s International Centre For Settlement Of Investment Disputes (ICSID) ruled that Argentina had breached the terms of a bilateral investment treaty the country held with Spain, specifically unlawfully expropriating Aerolíneas Argentinas and associated companies such as Optar, Jet Paq, Austral among others. The ICSID fined the state US$320.76 million and US$3.49 million in legal fees. Interest, dated back to December 2008, adds another US$23.76 million to the total payout settled by the ICSID tribunal. As such, the tribunal awarded about 20 percent of the US$1.59 billion the investors had claimed in the case.The majority was signed off on by Thomas Buergenthal, a US citizen and former judge at the International Court of Justice and Inter-American Court of Human Rights and president of the tribunal handling the case and Canadian arbitrator Henri Alvarez QC, who was appointed by the claimants. The arbitrator appointed by Argentina, Dr. Kamal Hossain, wrote a dissenting opinion that rejected the fundamental findings of the majority.Following the tribunal’s decision, Burford Capital Limited — a finance and investment firm — celebrated that it stood to earn “in the range ofUS$140 million” and is subject to an ongoing and compounding interest entitlement. Burford had financed the litigation for the claimant to the tune of US$13 million, and while the firm is not yet guaranteed the US$140 million, as it is subject to appeal, it nonetheless stands to make a handsome return. The previous government accused Burford of buying up the claim and its lawyers brought up the issue in the tribunal’s proceedings, saying that it would be the primary beneficiary of any ICSID award.The tribunal did not accept those arguments.“We are very pleased with this result and are gratified to see justice done for Teinver and its stakeholders. Without Burford’s capital, it is doubtful that this kind of recovery could have been obtained for the claimants,” said Christopher Bogart, Chief Executive Officer of Burford.Marsans was declared insolvent in 2010 and one of its former owners, Gerardo Díaz Ferrán, has been convicted on fraud charges in Spain.Aerolíneas Argentinas was expropriated in 2008 during former president Cristina Fernández de Kirchner’s first term with a law that was approved by Congress. Citing debts accrued by the Marsans Group in its operation of Aerolíneas, compensation of one peso was paid to the former controllers of the airline. Marsans rejected the terms of compensation. Mauricio Macri’s PRO voted against the expropriation and he was himself critical of the move in 2008. In response to the award, Macri called it a result of the “clumsiness” of the Kirchnerite government and how it handled the matter.Aerolíneas Argentinas has been under state control since 2008 and is currently under the stewardship of its second president in the Macri era. Mario Dell’Acqua replaced Isela Costantini as president at the end of 2016, and in January this year Siro Astolfi, formerly a member of one of the law firms that helped Marsans file the complaint, has been named vice-president of the airline’s board."[link] what is also interesting is their comme
ookyfly
28 Jul 2017
Re: Deafening silence on this board.... We're still digesting the good news and the steep rise this week in sp...... Well done, Burford. Makes up for my disaster with Juridica......
missmolly
28 Jul 2017
Deafening silence on this board.... Deafening silence on this board....
missmolly
27 Jul 2017
To Jane with thanks Thank you for your earlier reply to my questions on your thoughts re: the dollar etc. and please accept my apologies for this late reply - things got very hectic!I too have very few investments now, BUR,IQE and Fundsmith Equity, - it's Fundsmith that's affected by the dollar as they are invested in the US by approx. 64%. With Trumps antics driving the dollar down so goes the SP of F/smith.I did have a few more -IMG & Blue Prism, Zytronic but they were not moving like BUR & IQE so I sold and put the proceeds in them.We did well!I can't believe how quiet this board is today after those interims, and quite a roller coaster, it will be interesting for a couple of days I think.Have a good weekend too...Molly
missmolly
27 Jul 2017
Let's see what the US market does when it opens I imagine that there will be some buying and selling when the US market opens.And I expect the SP to be a bit volatile for the next couple of days.It's been a bit of a roller coaster in the UK today....
NorfolkFootsie
27 Jul 2017
Re: HIT From Burford's own website
O THE SHARES OF BURFORD CAPITAL QUALIFY FOR UK BUSINESS PROPERTY RELIEF?We are regularly asked by UK investors whether Burford’s shares qualify for UK Business Property Relief (“BPR”
for inheritance tax purposes. Burford cannot of course provide you with tax or other financial planning advice, and you should consult your own advisors rather than rely on what is stated here, but we provide the below comments in an effort to assist you in your own analysis.We are not aware of any case where Her Majesty’s Revenue & Customs (HMRC) has rejected Burford’s shares as qualifying for BPR.That is not, however, a complete answer. AIM shares like Burford’s are eligible for consideration for BPR. Unfortunately, the manner in which HMRC determines an ultimate position appears to be on a case-by-case basis. In other words, as part of the process for executing the will or administering the estate of a person who has died, a local HMRC agent will make his or her own individual assessment, which may or may not be consistent with an assessment made by another agent. There appears to be no HMRC master list of AIM-listed companies whose shares are eligible for BPR and there is no mechanism for obtaining an advance ruling.In our view, it is not possible for any company to provide investors with an assurance that their shares will qualify for BPR.
ookyfly
27 Jul 2017
Re: HIT InvestorsChampion will tell you - for a fee. (I'm in the same boat. Most of my assets are now in EIS's, which have tremendous advantages including 30% back from the taxman, assuming you pay enough tax.)
janebolacha
27 Jul 2017
Here's the full interim report. [link]
janebolacha
27 Jul 2017
Tremendous half-year results from Burford [link] ●Best ever results in Burford's history: 1H 2017 profit exceeds record profit for full year 2016 ●Income increased by 130% to $175.5 million (H1 2016: $76.2 million), driven by a 148% increase in investment income to $161.6 million (H1 2016: $65.3 million) ●151% increase in operating profit to half-year record of $155.0 million (H1 2016: $61.7 million), and 170% increase in profit after tax to $142.7 million (H1 2016: $52.8 million) ●Interim dividend of 3.05¢ (H1 2016: 2.67¢ declared, at the rate of one third of total 2016 dividend - an increase of 14% over last year's interim dividend. Interim dividend payable on 15 November 2017 with record date of 20 October 2017 ●Strong demand for Burford's capital, with record new commitments to investments of $488 million (comprising $226 million from our balance sheet and $262 million from our investment funds), $289 million of which already deployed ●Record investment performance underpinned by 11 investments, including largest cash generation from a single investment in our history, the sale of 25% of our ongoing Petersen investment ●Cash generation of $173.7 million from investments on balance sheet, exceeding every previous half-year period ●Oversubscribed retail bond offering, raising £175 million at a 5% coupon, to further support client demand and future growth ●Gerchen Keller acquisition and integration successful and well-received, first fund starting to generate performance fees. Burford's new investment management business closed largest investment fund ever raised in sector, at $500 million, to invest in complex strategies"
jonwig1
26 Jul 2017
Re: HIT Basically, it invests, it doesn't "make stuff". So it shouldn't be IHT-eligible. Investment companies are specifically excluded - at least that's my understanding.
Roverite
26 Jul 2017
HIT I've been investing in AIM shares for HIT avoidance. I've had my losses but I am phiosophical about losses of less than 40% as this is the hit my estate would take from HIT. My BUR holding, now at > 1000p, is up almost 400%. However, I have a suspicion that BUR might not qualify for HTI exemption. Does anyone have an educated view on how HMR&C might view BUR for HIT purposes?
janebolacha
25 Jul 2017
Hardman report on Burford, July 24. [link]
janebolacha
24 Jul 2017
Re: AerolÃneas/Air Austral/ Marsans award There's an interesting commentary here on the ICSID arbitration award in favour of Teivner/Marsans/Burford. It is from a very well regarded business news site in Argentina.[link] the section "cautela y negociación", there is this text:"En ese sentido, un mensaje del presidente Mauricio Macri por las redes sociales estuvo lejos de rechazar el fallo: le adjudicó responsabilidad por la deuda a pagar al gobierno de Cristina Kirchner, precandidata a senadora por Unidad Ciudadana en las próximas elecciones.“Por la inmensa torpeza y arrogancia que el gobierno anterior tuvo con Aerolíneas el país fue condenado a pagar u$s320 millones más intereses”, escribió Macri en Twitter.“Nos llega esta condena en el mejor momento de la historia de Aerolíneas y los vuelos comerciales, con récord total de pasajeros transportados”, agregó para luego afirmar que “nada detendrá a la revolución de los vuelos que está en marcha uniendo al país, llevando cada vez a más argentinos con mejores tarifas”.Así, se desprende que para el jefe de estado, el fallo es justo. Sin embargo, no se podía esperar otra reacción del Presidente en plena campaña electoral y a 20 días de las PASO en la que el oficialismo tendrá un difícil reto con la expresidenta en la provincia de Buenos Aires.Fuera del ámbito doméstico, se espera que el Estado negocie los términos del fallo en contra."What they are saying here is that President Macri, in a message on social media, far from rejecting the judgement, instead put the responsibility for it on the past government of former President Cristina Kirchner, who is expected to stand as a candidate for the Senate for Buenos Aires Province in elections to be held three weeks from now and who is expected to put up a tough fight against Macri's party. Macri tweeted that "it was because of the immense sloth and arrogance of the previous government in managing Aerolíneas that the country now stands condemned to pay $320m plus interest" and he goes on to highlight that Aerolíneas, under his government, has recovered and is now performing very well indeed. The article states that one can deduce that for President Macri the verdict is fair, although the article also cautions that this is a time of electoral campaigning and that this response from Macri was thus to be expected.The article also picks up on Burford's reference to there being often negotiations to arrive at an agreed settlement and seems to be linking this in with President Macri's response to Burford's statement and implying that a negotiated settlement could well find favour in Buenos Aires.My own view is that while the Macri government is obviously very keen to put to rest Argentina's dismal past record of fighting continually against the international financial community, local politics are inherently unstable and political necessity could blow this off track. Only last month, Argentina was able to raise in New York $2.75bn in 100-year bonds (yes, really!) and for Argentina to go back to its old ways of fighting every last decision they don't agree with would likely put the shutters up once more against international bond issues. In the grand scheme of things, the Marsans/Burford judgement is very small beer for Argentina and it would be in their interest to settle the matter quickly and get it over and done with.The much bigger "Petersen" claim (also a Burford case) in respect of the expropriation of the YPF energy group is coming fast down the tracks and that is likely to give President Macri even greater opportunities to open up numerous cans of worms about the alleged corruption on a gigantic scale of past Kirchner governments. It may well suit Macri now to settle this relatively small Aerolíneas case, keeping Argentina on track to access international money markets while also using the judgem
jonwig1
24 Jul 2017
Mastercard - Correction Some have suggested that BUR will lose up to £40m after the collapse of the Mastercard action. This is untrue. The £40m commitment was from funds managed bt GKC which had $1.3bn under management. In other words, other peoples' money.The overall assets of the fund will be depleted (by some 2.4%) and BUR is less likely to earn a performance fee on the particular fund. In the grand scheme of things, it's a triviality apart perhaps reputationally.
janebolacha
24 Jul 2017
AerolÃneas/Air Austral/ Marsans award I have found some info on an Argentine site which refers to the way that Burford is remunerated. It is in Spanish (I am a translator) and I won't translate the article but you can use Google Translate, should you wish to do so. This para states that Burford would be entitled to four times their investment (hence four times Burford's costs of $13m, ie. $52m), then 40% of the first $100m (I assume they are interpreting this as meaning the first $100m after the $52m), then 30% of the balance.On an award of $324m, this would work out at, firstly, $52m (ie. 4 x $13m) plus, secondly, $40m plus, thirdly, 30% of ($324 - 52 - 100), that is $51.6m, adding them up we get to $52m plus $40m plus $51.6m, a total of $143.6m, which is about the figure Burford are quoting."El negocio de Burford ha sido brutal, con una plusvalía del orden del 1000%, ya que solamente ha gastado 13 millones. El acuerdo al que llegaron los dueños de Marsans con estos buitres, al que luego se adhirió la administración concursal de Air Comet, establecía que cobrarían una cantidad fija del orden de 4 veces el dinero que hubieran gastado hasta el fallo del CIADI, más unos porcentajes escalonados, según la indemnización conseguida, un 40% de los primeros 100 millones, y el 30% para el resto hasta 500 millones."[link] if this is the model of reward that Burford are using in their contracts, it's very clever, their costs get fully covered first and then there's a tremendous incentive to push hard for a great chunk out of award beyond this.(PS: I have no idea where the site got this info. A leak from inside one of the Argentine parties, perhaps?).
