To be rebranded simply as Burford Capital, the combined will have more than $1.2bn worth of investment assets and commitments, making it the largest funder by far in the evolving litigation funding market. The new firm will employ around 80 people, including 40 lawyers, in offices across London, New York and Chicago. Burford is reportedly offering to tack on an extra $15m to the purchase price by awarding Burford shares to select Gerchen executives if Gerchen’s funds make $100m in performance fees.
Increased appetite for litigation funding
London-based Burford has been one of the pioneers in the blossoming litigation funding marketplace since being launched in 2009 by former Time Warner general counsel Chris Bogart and Georgetown Law professor Jon Molot. Gerchen Keller is headquartered in Chicago and was founded just three years ago by former Goldman Sachs investment banker Adam Gerchen and former Bartlit Beck Herman Panelchar & Scott partner Ashley Keller. Publicly-listed Burford sources capital from public equity investors, while private Gerchen operated under a more ‘low risk, low return’ model with capital primarily derived from funds.
Burford chief executive Mr Bogart said of the union: ‘What we are seeing in the market today is this increased velocity in the demand for capital – from law firms and corporate clients – and an ever-widening demand for new products and innovation. While each of us were doing our best to meet that demand, we believe that with a broader and more flexible capital base… we will be able to do that.’