Burford shifts focus to wider litigation funding portfolio after $2.4bn YPF write-down

Burford Capital is trying to move past the “disappointing” US court ruling in March that overturned a major judgment tied to one of the litigation funder’s most valuable assets.

The dispute stems from Argentina’s 2012 expropriation of shares in YPF, the majority state-owned energy company. In 2023, a US judge ruled Argentina owed around $16 billion in damages and interest to former minority shareholders, representing a landmark win for Burford which purchased the claims a decade ago.

Ruling overturned

That decision was overturned by a US appeals court in March, forcing Burford to take a $2.4 billion write-down on the asset. The reversal pushed the listed litigation funder to a $1.6 billion first-quarter loss when it reported earnings last week and wiped almost half off its market value when the judgment was handed down.

Speaking at a media briefing on Tuesday, Burford chief executive Chris Bogart said the company would continue pursuing legal options following the setback, although he acknowledged the US court “rarely grants such requests”, making international arbitration the more likely route forward.

Despite the setback, Burford insists that the asset still has value, even if the duration is extended and could take years to materialise. While a significant step down from the initial judgment, Burford says that it still generated a $100 million profit on YPF by selling minority stakes in the claim to third-party investors.

Bread and butter

Burford drew attention last year when it took a minority investment in legal consultancy Kindleworth last year, sparking speculation in parts of the legal market about whether the company could eventually become more directly involved in law firm ownership beyond the minority stake it took in litigation boutique PCB in 2020.

Kindleworth has played a role in launching boutique firms including Pallas Partners and Rosenblatt Law.

But Bogart made clear the litigation finance giant remains concentrated on its bread and butter - funding large-scale commercial claims handled by major law firms and specialist disputes practices.

Wider portfolio

Burford is now attempting to shift attention back towards its wider litigation finance business beyond the YPF matter.

In its latest earnings, the company said its broader portfolio includes more than 230 active assets, which it believes could generate more than $5 billion in future returns.

The group also announced last week that London-based chief development officer Travis Lenkner had been promoted to chief operating officer.