IMF Bentham calls $84m raising to seize litigation trends
Written on the 23 October 2018 by David Simmons
Global litigation funder IMF Bentham (ASX: IMF) is preparing to raise over $84 million to prepare for a range of opportunities presently in reach for the company.
The listed company will conduct a fully underwritten institutional placement to raise $74.48 million, comprising an issue of 26.6 million new IMF ordinary shares.
The group also plans to conduct a non-underwritten share purchase plan to facilitate retail shareholder participation of up to $15,000 per eligible shareholder, subject to an overall cap of $10 million.
The total amount of money raised will go towards growth initiatives according to IMF managing director Andrew Saker.
"The equity raising will allow us to take advantage of the numerous opportunities that are currently before IMF," says Saker.
"We are seeing strong pipelines in all jurisdictions and IMF is targeting two new funds (a US fund and a non-US fund) with the aim of having close to $1.5 billion in funds under management by the end of FY19."
"We believe it is a prudent time to fund IMF's future expected commitments to these funds and expansion growth plans, while also increasing financial flexibility."
The company hopes to be able to expand its existing operations in Asia and Canada following the raise and will also establish a footprint in continental Europe.
The placement, which represents 15 per cent of the current ordinary shares on issue, represents a discount of 10 per cent to the closing price of $3.11 per share on 22 October 2018.
This year, IMF Bentham has been bankrolling a number of high-profile class actions. Of note is its involvement in the shareholder class action against Sirtex which resulted in the Australian Securities and Investment Commission charging Sirtex CEO Gilman Edwin Wong with insider trading.
The litigation funder is also backing a class action against Retail Food Group by Phi Finney McDonald one of three against the retail food franchisor.
Perhaps the most high-profile class action being funded by IMF is against AMP. The class action arose from allegations made during the Royal Commission into the banking and finance sector.
Business News Australia
Author: David Simmons