Litigation Funding Consolidates In Multi-Million Pound Acquisition By Bank
One of the central indicators of a maturing market is consolidation and the first rumblings of this has become evident within litigation funding as big merchant bank Close Brothers Group recently snared Salisbury-based Novitas Loans Limited.
Although the acquisition was for an “undisclosed amount” clues can be found in the fact that Close Brothers revealed earlier in the year of their intention to acquire “a specialist provider of secured finance to law firms and clients” with a loan book of £32m.
The bank does not appear shy of its ambitions in leading the way in “market-leading working capital funding proposition[s]” having spotted the huge potential of providing cash flow to those who would normally think twice before pursuing a legal process due to a lack of liquid funds, according to its chief executive David Thompson.
Close Brothers already offers professional indemnity funding, VAT loans and practice loans to the legal sector and now with litigation funding under its wing it is certainly closing the circle of services needed by the law. The Novitas name will continue but with the backing of Close Brothers it is likely to enjoy a bulging loan book.
The question remains however will organisations like Close Brothers simply serve the litigious ambitions of other large corporations or will smaller practices and private individuals also be able to tap into some of the obvious advantages that third party funders can provide?