v3.26.1
Fair value of assets and liabilities
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair value of assets and liabilities Fair value of assets and liabilities
The tables below set forth the fair value of financial instruments grouped by the fair value level as of the dates indicated.
June 30, 2026
($ in thousands)Level 1Level 2Level 3Total
Assets:
Capital provision assets
Derivative financial assets
Single case$— $— $768,850$768,850
Portfolio— — 1,389,4461,389,446
Portfolio with equity risk— — 39,25939,259
Legal risk management— — 6,2106,210
Non-derivative financial assets
Joint ventures and equity method investments— — 216,341216,341
Single case with equity risk1,848— — 1,848
Assets of consolidated investment companies
Core legal finance (BOF-C)2,272— 655,297657,569
Core legal finance (EP Funds)— — 38,17238,172
Lower risk legal finance (Advantage Fund)— — 66,98266,982
Total capital provision assets4,120— 3,180,5573,184,677
Due from settlement of capital provision assets— — 122,370122,370
Marketable securities
Government securities— -— -
Corporate bonds— 29,547— 29,547
Asset-backed securities— 9,654— 9,654
Mutual funds4,790— — 4,790
Certificates of deposit6,370— — 6,370
Total assets15,28039,2013,302,9273,357,408
Liabilities:
Financial liabilities relating to third-party interests in capital provision assets— — 93,00093,000
Total liabilities— — 93,00093,000
Net total15,28039,2013,209,9273,264,408
December 31, 2025
($ in thousands)Level 1Level 2Level 3Total
Assets:
Capital provision assets
Derivative financial assets
Single case$— $— $819,515$819,515
Portfolio— — 3,383,3173,383,317
Portfolio with equity risk— — 38,52438,524
Legal risk management— — 5,7375,737
Non-derivative financial assets
Joint ventures and equity method investments— — 189,488189,488
Single case with equity risk2,811— — 2,811
Assets of consolidated investment companies
Core legal finance (BOF-C)2,846— 650,616653,462
Core legal finance (EP Funds)— — 451,407451,407
Lower risk legal finance (Advantage Fund)— — 65,68865,688
Total capital provision assets5,657— 5,604,2925,609,949
Due from settlement of capital provision assets— — 164,804164,804
Marketable securities
Government securities— 58,333— 58,333
Corporate bonds— 15,861— 15,861
Asset-backed securities— 1,177— 1,177
Mutual funds7,828— — 7,828
Certificates of deposit6,287— — 6,287
Total assets19,77275,3715,769,0965,864,239
Liabilities:
Financial liabilities relating to third-party interests in capital provision assets— — 858,491858,491
Total liabilities— — 858,491858,491
Net total19,77275,3714,910,6055,005,748
The Group has elected the fair value option for the Group’s equity method investments, marketable securities, due from settlement of capital provision assets and financial liabilities relating to third-party interests in capital provision assets to provide a consistent fair value measurement approach for all capital provision related activity. Realized gains and losses, unrealized gains and losses and interest and dividend income on these assets are recognized as income/(loss) and presented in the unaudited condensed consolidated statements of operations when they are earned.
The key risk and sensitivity across all the capital provision assets relate to the underlying litigation associated with each case that is underwritten and financed. The sensitivity to this Level 3 input is therefore considered to be similar across the different types of capital provision assets and is expressed as a portfolio-wide stress.
Movements in Level 3 fair value assets and liabilities
The tables below set forth the analysis of the movements in the Level 3 financial assets and liabilities for the periods indicated.
Three months ended June 30, 2026
($ in thousands)Beginning
of period		Transfers
into Level 3		TransfersDeploymentsRealizationsIncome/(loss)
for the
period		Foreign
exchange
gains/(losses)		End of
period
Single case$752,077$— $— $37,101$(49,777)$30,154$(705)$768,850
Portfolio1,336,333— — 53,449(36,347)36,803(792)1,389,446
Portfolio with equity risk31,788— — 91— 7,380— 39,259
Legal risk management5,927— — — — 332(49)6,210
Joint ventures and equity method investments204,964— — 4,682(27)7,961(1,239)216,341
Core legal finance (BOF-C)678,522— — 14,299(59,198)21,674— 655,297
Core legal finance (EP Funds)38,357— — 454— (639)— 38,172
Lower risk legal finance (Advantage Fund)67,004— — — (1,800)1,778— 66,982
Total capital provision assets3,114,972 — — 110,076(147,149)105,443(2,785)3,180,557
Due from settlement of capital provision assets180,041— — 148,970 (208,032)1,250141 122,370 
Total Level 3 assets3,295,013 — — 259,046 (355,181)106,693 (2,644)3,302,927
Financial liabilities relating to third-party interests in capital provision assets87,698— — 6,525 15(1,112)(126)93,000 
Total Level 3 liabilities87,698 — — 6,525 15 (1,112)(126)93,000
Three months ended June 30, 2025
($ in thousands)Beginning
of period		Transfers
into Level 3		TransfersDeploymentsRealizationsIncome/(loss)
for the
period		Foreign
exchange
gains/(losses)		End of
period
Single case$756,442 $— $— $45,340 $(37,713)$35,755 $7,317 $807,141 
Portfolio3,099,848 — — 33,810 (13,359)109,724 5,150 3,235,173 
Portfolio with equity risk74,222 — — 91 — 2,638 — 76,951 
Legal risk management7,197 — — — — 641 609 8,447 
Joint ventures and equity method investments157,435 — — — (240)19,176 4,408 180,779 
Core legal finance (BOF-C)679,101 — — 20,635 (13,889)14,119 (24)699,942 
Core legal finance (EP Funds)1
410,204 — — — — 21,800 — 432,004
Lower risk legal finance (Advantage Fund)108,050 — — 428 (22,774)5,318 — 91,022 
Total capital provision assets5,292,499 — — 100,304 (87,975)209,171 17,460 5,531,459 
Due from settlement of capital provision assets102,648 — — 90,077 (76,758)2,303 181 118,451 
Total Level 3 assets5,395,147 — — 190,381 (164,733)211,474 17,641 5,649,910 
Financial liabilities relating to third-party interests in capital provision assets780,330 — — (237)— 43,257 80 823,430 
Total Level 3 liabilities780,330 — — (237)— 43,257 80 823,430
1. The restructuring of the EP Funds resulted in the Group being required to consolidate the underlying assets and liabilities of the entities as of June 30, 2025. See note 2 (Summary of significant accounting policies) for additional information with respect to the EP Funds. Prior to consolidation, the Group had a “Single case” capital provision asset with the EP Funds representing its Eton Park interest in the YPF-related assets. This asset is eliminated on consolidation and forms part of the additions to “Core legal finance (EP Funds)”. The “Core legal finance (EP Funds)” end-of-period balance includes $82.6 million attributable to third-party interests, of which approximately $80.0 million were other additions that are offset by other third-party liabilities assumed on consolidation.
Six months ended June 30, 2026
($ in thousands)Beginning
of period		Transfers
into Level 3		TransfersDeploymentsRealizationsIncome/(loss)
for the
period		Foreign
exchange
gains/(losses)		End of
period
Single case$819,515$— $(11,940)$58,026 $(87,809)$(5,918)$(3,024)$768,850
Portfolio3,383,317— (6,580)136,455 (93,514)(2,028,475)(1,757)1,389,446
Portfolio with equity risk38,524— — 180 — 555 — 39,259
Legal risk management5,737— — — — 649 (176)6,210
Joint ventures and equity method investments189,488— — 12,303 (583)18,662 (3,529)216,341
Core legal finance (BOF-C)650,616— (4,523)42,202 (63,076)30,078 — 655,297
Core legal finance (EP Funds)451,407 — — 857 — (414,092)— 38,172
Lower risk legal finance (Advantage Fund)65,688— — — (3,436)4,730 — 66,982
Total capital provision assets5,604,292— (23,043)250,023(248,418)(2,393,811)(8,486)3,180,557
Due from settlement of capital provision assets164,804 — — 250,279 (294,381)1,820 (152)122,370 
Total Level 3 assets5,769,096— (23,043)500,302(542,799)(2,391,991)(8,638)3,302,927
Financial liabilities relating to third-party interests in capital provision assets858,491 — 1,174 6,525 (44)(773,007)(139)93,000 
Total Level 3 liabilities858,491— 1,174 6,525 (44)(773,007)(139)93,000
Six months ended June 30, 2025
($ in thousands)Beginning
of period		Transfers
into Level 3		TransfersDeploymentsRealizationsIncome/(loss)
for the
period		Foreign
exchange
gains/(losses)		End of
period
Single case$1,052,519 $— $(286,474)$107,400 $(135,349)$58,995 $10,050 $807,141 
Portfolio3,053,800 — — 61,779 (62,907)175,487 7,014 3,235,173 
Portfolio with equity risk65,041 — — 180 — 11,730 — 76,951 
Legal risk management6,442 — — — — 1,118 887 8,447 
Joint ventures and equity method investments154,220 — — — (825)20,318 7,066 180,779 
Core legal finance (BOF-C)705,315 — — 31,185 (67,481)30,923 — 699,942 
Core legal finance (EP Funds)1
— — 286,474 115,301 — 30,229 — 432,004
Lower risk legal finance (Advantage Fund)189,288 — — 935 (108,483)9,282 — 91,022 
Total capital provision assets5,226,625 — — 316,780 (375,045)338,082 25,017 5,531,459 
Due from settlement of capital provision assets183,858 — — 378,925 (447,812)2,955 525 118,451 
Total Level 3 assets5,410,483 — — 695,705 (822,857)341,037 25,542 5,649,910 
Financial liabilities relating to third-party interests in capital provision assets747,053 — — 12,242 — 64,053 82 823,430 
Total Level 3 liabilities747,053 — — 12,242 — 64,053 82 823,430
1. The restructuring of the EP Funds resulted in the Group being required to consolidate the underlying assets and liabilities of the entities as of June 30, 2025. See note 2 (Summary of significant accounting policies) for additional information with respect to the EP Funds. Prior to consolidation, the Group had a “Single case” capital provision asset with the EP Funds representing its Eton Park interest in the YPF-related assets. This asset is eliminated on consolidation and forms part of the additions to “Core legal finance (EP Funds)”. The “Core legal finance (EP Funds)” end-of-period balance includes $82.6 million attributable to third-party interests, of which approximately $80.0 million were other additions that are offset by other third-party liabilities assumed on consolidation.
All transfers into and out of Level 3 are recognized as if they have taken place as of the beginning of each reporting period. There were no transfers into or out of Level 3 during the three and six months ended June 30, 2026 and 2025.
Key unobservable inputs for Level 3 valuations
The Group’s valuation policy for capital provision assets provides for ranges of percentages to be applied against the risk-adjustment factor to more than 70 discrete objective litigation events across five principal different types of litigation in order to calculate the adjusted risk premium. The range for each event is ten percentage points. The Company typically marks assets at the middle of that range unless there are specific factors that cause the Group’s valuation committee to select a different point in the range and, on an exceptional basis, the Group’s valuation committee may also select a point outside the range. To decide which percentage to apply to a given asset, the Group’s valuation committee considers the kind and degree of legal, procedural or other investment-specific circumstances that may be present. See note 2 (Summary of significant accounting policies—Fair value of financial instruments) for additional information with respect to the Group’s valuation approach.
The tables below set forth each of the key unobservable inputs used to value the Group’s capital provision assets and the applicable ranges and weighted average by relative fair value for such inputs as of the dates indicated.
($ in thousands)June 30, 2026
Type:
Single case, Portfolio, Legal risk management, Joint ventures and equity method investments, Core legal finance (BOF-C)(1), Core legal finance (EP Funds), Financial liabilities relating to third-party interests in capital provision assets
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate5.1%7.7%6.7%
Duration(2) (years)
0.513.83.5
Adjusted risk premium0.0%100.0%48.6%
Positive case milestone factor:
Significant ruling or other objective event prior to trial court judgment$153,869$114,143$268,0125.0%40.0%25.7%
Trial court judgment or tribunal award77,118115,923193,04125.0%60.0%56.9%
Appeal judgment63,04069,428132,46867.6%80.0%69.3%
Asset freeze2,4419163,3574.4%4.4%4.4%
Exhaustion of as-of-right appeals5,0007,52612,52680.0%80.0%80.0%
Exhaustion of all appeals79,88252,828132,710100.0%100.0%100.0%
Settlement9,417(2,254)7,16380.0%100.0%100.0%
Portfolios with multiple factors643,086392,3871,035,4730.0%100.0%23.9%
Other341(167)174100.0%100.0%100.0%
Negative case milestone factor:
Significant ruling or other objective event prior to trial court judgment65,622(44,408)21,214(40.0)%(60.0)%(47.1)%
Trial court judgment or tribunal award63,062(30,819)32,243(10.0)%(60.0)%(58.7)%
Appeal judgment10,980(12,032)(1,052)(80.0)%(100.0)%(80.0)%
Portfolios with multiple factors50,616(29,654)20,962(10.0)%(56.7)%(28.3)%
No case milestone:1,095,229(80,061)1,015,168
YPF-related assets:125,623(24,559)101,064
2,445,326529,1972,974,523
Type:Lower risk legal finance (Advantage Fund)
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate57,9339,05066,98311.9%20.8%14.8%
Duration(2) (years)
0.32.51.1
Type:
Portfolio with equity risk, Core legal finance (BOF-C)(1)
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate30,72415,32746,05114.0 %14.0 %14.0 %
Resolution timing (years)0.32.30.9
Conversion ratio0.50.50.5
Type:Due from settlement of capital provision assets
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate122,127243 122,3706.6%6.6%6.6%
Collection risk— %— %— %
Level 3 assets and liabilities, net2,656,110553,8173,209,927
1. Includes the proportional participation in these capital provision assets held by BOF-C.
2. Duration refers to the expected timing of a favorable outcome. See note 2 (Summary of significant accounting policies—Fair value of financial instruments) for additional information with respect to the valuation methodology for Level 3 assets.
($ in thousands)December 31, 2025
Type:
Single case, Portfolio, Legal risk management, Joint ventures and equity method investments, Core legal finance (BOF-C)(1), Core legal finance (EP Funds), Financial liabilities relating to third-party interests in capital provision assets
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate4.6%7.5%6.1%
Duration(2) (years)
0.213.02.8
Adjusted risk premium0.0%100.0%31.1%
Positive case milestone factor:
Significant ruling or other objective event prior to trial court judgment$162,058$114,685$276,7435.0%40.0%24.9%
Trial court judgment or tribunal award83,55094,354177,90425.0%60.0%54.1%
Appeal judgment62,91677,731140,64768.6%80.0%70.0%
Asset freeze2,4418303,2714.4%4.4%4.4%
Exhaustion of as-of-right appeals5,0007,35012,35080.0%80.0%80.0%
Exhaustion of all appeals79,320119,559198,879100.0%100.0%100.0%
Settlement4201,3791,79940.0%80.0%78.1%
Portfolios with multiple factors641,286384,9161,026,2020.5%100.0%21.3%
Other332(168)164100.0%100.0%100.0%
Negative case milestone factor:
Significant ruling or other objective event prior to trial court judgment76,582(53,750)22,832(40.0)%(60.0)%(49.9)%
Trial court judgment or tribunal award46,376(28,340)18,036(10.0)%(60.0)%(56.6)%
Appeal judgment14,164(16,992)(2,828)(80.0)%(100.0)%(80.0)%
Portfolios with multiple factors48,542(29,953)18,589(10.0)%(80.0)%(31.2)%
No case milestone:1,029,32321,6551,050,978
YPF-related assets:117,5771,571,7811,689,358
2,369,8872,265,0374,634,924
Type:Lower risk legal finance (Advantage Fund)
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate58,7906,89865,68811.4%20.3%14.3%
Duration(2) (years)
0.72.51.3
Type:
Portfolio with equity risk, Core legal finance (BOF-C)(2)
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate30,72314,466 45,18912.8%12.8%12.8%
Resolution timing (years)0.82.81.5
Conversion ratio0.50.50.5
Type:Due from settlement of capital provision assets
Principal value technique:Discounted cash flow
Unobservable input:CostUnrealizedFair valueMinimumMaximumWeighted average
Discount rate160,4444,360 164,8046.2%6.2%6.2%
Collection risk0.0%0.0%0.0%
Level 3 assets and liabilities, net2,619,8442,290,7614,910,605
1. Includes the proportional participation in these capital provision assets held by BOF-C.
2. Duration refers to the expected timing of a favorable outcome. See note 2 (Summary of significant accounting policies—Fair value of financial instruments) for additional information with respect to the valuation methodology for Level 3 assets.
Sensitivity of Level 3 valuations
Following origination, the Group engages in a review of each capital provision asset’s fair value in connection with the preparation of the unaudited condensed consolidated financial statements. Should the prices of the Level 3 due from settlement of capital provision assets, capital provision assets and financial liabilities relating to third-party interests in capital provision assets have been 10% higher or lower, while all other variables remained constant, the Group’s unaudited condensed consolidated income and net assets would have increased or decreased, as applicable, by $321.0 million and $491.1 million as of June 30, 2026 and December 31, 2025, respectively.
In addition, as of June 30, 2026 and December 31, 2025, should interest rates have been 50 or 100 basis points lower or higher, as applicable, than the actual interest rates used in the fair value estimates, while all other variables remained constant, the Group’s unaudited condensed consolidated income and net assets would have increased or decreased, as applicable, by the following amounts.
($ in thousands)June 30, 2026December 31, 2025
+100 bps interest rates$(118,337)$(166,466)
+50 bps interest rates(59,576)(83,662)
-50 bps interest rates63,55487,423
-100 bps interest rates128,098175,812
Furthermore, as of June 30, 2026 and December 31, 2025, should duration have been six or 12 months shorter or longer, as applicable, than the actual durations used in the fair value estimates, while all other variables remained constant, the Group’s unaudited condensed consolidated income and net assets would have increased or decreased, as applicable, by the following amounts.
($ in thousands)June 30, 2026December 31, 2025
+12 months duration(1)
$(257,236)$(422,303)
+6 months duration(1)
(129,030)(229,491)
-6 months duration(1)
134,128199,038
-12 months duration(1)
269,242383,172
1. Duration refers to the expected timing of a favorable outcome. See note 2 (Summary of significant accounting policies—Fair value of financial instruments) for additional information with respect to the valuation methodology for Level 3 assets.
The sensitivity impact has been provided on a pre-tax basis for both the Group’s consolidated income and net assets as the Group considers the fluctuation in its effective tax rate from period to period could indicate changes in sensitivity not driven by the valuation that are difficult to follow and detract from the comparability of this information.
Reasonably possible alternative assumptions
The determination of fair value for capital provision assets, due from settlement of capital provision assets and financial liabilities relating to third-party interests in capital provision assets involves significant judgments and estimates. While the potential range of outcomes for the assets is wide, the Group’s fair value estimation is its best assessment of the current fair value of each asset or liability, as applicable. Such estimate is inherently subjective, being based largely on an assessment of how individual events have changed the possible outcomes of the asset or liability, as applicable, and their relative probabilities and hence the extent to which the fair value has altered. The aggregate of the fair values selected falls within a wide range of reasonably possible estimates. In the Group’s opinion, there is no useful alternative valuation that would better quantify the market risk inherent in the portfolio and there are no inputs or variables to which the values of the assets are correlated other than interest rates that impact the discount rates applied.