IMF Bentham to buy European litigation funder for $141m

IMF Bentham to buy European litigation funder for $141m

An Australian group that has funded class actions against the likes of National Australia Bank (ASX: NAB), Sirtex and Murray Goulburn (ASX: MGC) is about to spread its wings.

IMF Bentham (ASX: IMF) has agreed to acquire Netherlands-headquartered Omni Bridgeway for 87.5 million euros ($141 million) as part of a five-year plan to diversify its risks.

The move will give IMF exposure to Omni Bridgeway's specialty in civil law jurisdictions across Central Europe, the Middle East, North Africa and Central Asia, where it funds litigation, arbitration and enforcement proceedings.

With offices in Amsterdam, Cologne, Geneva, Dubai and Singapore, the target company recorded around $32 million in revenue in FY18 along with $5 million in profit. However, its claims portfolio is worth approximately $55 million with claims value under management of more than $4 billion.

"The acquisition of Omni Bridgeway symbolises the completion of IMF's initial five-year plan to diversify risk through, amongst other things, geographic expansion and sourcing capital from third parties," IMF Bentham said in today's announcement.

"The acquisition is expected to accelerate IMF's growth and create a major diversified global litigation funding platform across common law and civil law jurisdictions in both developed and emerging markets.

"Omni Bridgeway complements IMF's infrastructure and the Acquisition is expected to create the most comprehensive global platform for sourcing investment opportunities and expanding service offerings."

The acquisition will be funded by a fully underwritten equity raising for $139 million with a placement price of $3.50 per share, representing a 7.4 per cent discount to the last traded price.

Under the acquisition terms, IMF will pay around $57 million in cash upfront, followed by approximately $32 million to be paid in two equal instalments over three years. 

IMF, led by CEO Andrew Saker (pictured), entered a trading halt before the market opened this morning, which is expected to be lifted at the market open this Thursday, followed by a retail entitlement offer to be opened on 22 October.

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