High-profile litigation funder Vannin Capital has been acquired by private equity house Fortress almost a year after shelving its planned initial public offering (IPO) due to market volatility.
The buyout sees Fortress acquire 100% of the equity in Vannin from existing shareholders, including majority owner Bramden investments, with private equity backing now preferred over a significant public raising.
‘We are pleased to announce the sale of our interests in Vannin Capital to Fortress Investment Group,’ said founder and managing director of Bramden Investments Dan Craddock. ‘Over the last few months, as we evaluated how best to accelerate future growth, we have received several offers for the business. Fortress represented the strongest choice in all respects, not least due to its established position in the market and its long-standing relationship with Vannin.’
In October of last year Vannin decided to halt its plans to pursue an IPO, blaming volatile equity markets. The decision stymied Vannin’s plans to use a post-IPO war chest to drive growth in Singapore, Hong Kong and the US. Investment in commercial arbitration and investment treaty through additional hires was also a target.
Meanwhile, Fortress has been a long-term backer of Vannin, having announced the creation of a senior secured debt facility with the litigation funder in 2016. As a result of the acquisition, Vannin’s chief executive Richard Hextall and chief financial officer David Collins will make way for a new management team. The buyout also follows a similar move from New Law pioneer Axiom who today (6 September) similarly abandoned long-mooted IPO plans in favour of private equity backing.
Litigation funders have been in the spotlight recently after Burford Capital suffered a broadside from American investor Muddy Waters, which scrutinized Burford’s governance structure and accountancy practices in a prolonged exchange between the pair.