Burford Capital is to acquire GKC Holdings, the parent of Chicago-based Gerchen Keller Capital, for USD160 million in a combination of cash, Burford shares and loan notes and a further potential USD15 million in performance-based share consideration.
The acquisition will be immediately accretive to earnings per share.
GKC is a law-focused investment manager, registered as an investment adviser with the US Securities and Exchange Commission. It currently has USD1.3 billion in assets under management in private investment vehicles, raised from public pensions, financial institutions, university endowments, foundations and family offices.
Burford and GKC are the two largest litigation finance players in the world. Together, the firms have committed more than USD2 billion to investments since their respective inceptions, and their current portfolios will, combined, total more than USD1.2 billion in investment assets and commitments.
The enlarged business will have more than 80 staff, including 40 experienced lawyers, with the GKC team joining Burford and GKC’s principals taking on senior roles in the combined business.
Burford’s CEO Christopher Bogart says: “Burford and Gerchen Keller are widely regarded as the world’s two leading litigation finance providers. We know each other well and we approach the legal market in similar ways. The opportunity to combine the largest public player and the largest private capital manager is unique and will create the clear leader in this rapidly growing and evolving industry. Burford’s public shareholders will benefit from a larger, high quality team generating a broader array of investment opportunities and the addition of a significant flow of predictable management and performance fee income.
“Gerchen Keller’s investors will benefit from expanded investment opportunities through the addition of Burford’s experienced team and our extensive track record. And our clients – companies and law firms around the world – will benefit from having a capital provider with tremendous financial resources across both public and private capital markets able to meet all of their legal capital needs and innovate with them. We are thrilled to be partnering with the Gerchen Keller team and look forward to the continued acceleration of our joint business.”
GKC’s CEO Adam Gerchen adds: “We are excited to be joining with the Burford team to lead our industry into the future together. Our firms share similar cultures and ambitions, and we are looking forward to all of the exciting things we can do together for the benefit of all of our investors and clients.”
