Business
LCM Global Alternative Returns Fund II
LCM Global Alternative Returns Fund II.
About this update from Litigation Capital Management Ltd
[{"type":"text","content":"\n \n \n \n RNS Number : 0187P\n Litigation Capital Management Ltd\n 14 October 2021\n \n \n \n \n 14 October 2021\n \n \n \n \n \n Litigation Capital Management Limited\n \n \n (LCM or the Company)\n \n \n \n \n \n \n LCM completes US$200m first close of \n \n \n LCM Global Alternative Returns Fund II (\n \n \n Fund II) \n \n \n \n with target of US$300m\n \n \n \n \n \n \n \n \n Litigation Capital Management Limited (AIM:LIT), a leading international alternate asset manager of disputes financing solutions, is pleased to announce the first close of a second third-party fund, Fund II. In accordance with the Company's strategy and as previously communicated to the market, the close of Fund II accelerates our asset management strategy, managing third-party funds. With a target of US$300 million, total Assets Under Management (AUM) for LCM is expected to reach US$450 million on final close. This supplements the Company's balance sheet capital and allows us to expand and diversify our portfolio under management. \n \n \n \n \n \n First close of Fund II is predominantly underpinned by existing investors in LCM Global Alternative Returns Fund (Fund I), which comprises a large endowment of a US University and the asset management division of a large global investment bank. Both have extensive experience of investing in the litigation finance asset class. \n \n \n Structure\n \n \n The Fund II structure is very similar to Fund I and is detailed as follows:\n \n \n · \n Fund II will co-invest with investments from LCM's balance sheet on a 75:25 basis\n \n \n · \n LCM's balance sheet contribution (25%) will be invested and advanced on a monthly basis over the term of each investment, no upfront contribution is required\n \n \n · \n Performance fees will be payable to LCM as fund manager on the basis of a deal-by-deal waterfall\n \n \n · \n In addition to receiving its 25% share of any profit from each direct investment from its co-investment, the fund will pay performance fees to LCM as fund manager as follows:\n \n \n -\n 25% of profit on each Fund II investment as and when it matures over a soft return hurdle (full catch up) of 8%; and\n \n \n -\n an outperformance return of 35% for all Fund II returns which achieve a return over an IRR of 20%\n \n \n · \n Fund II has a term of six years includi...