Litigation Capital Writes Off £5 Million Investment After Appeal Permission Denied
Key Facts
Litigation Capital Management (AIM:LIT) said in a London Stock Exchange disclosure issued on November 9, 2026, that it would write off an investment after the party it funded failed to obtain permission to appeal in a commercial dispute. The company said the investment was carried at £5.0 million, equivalent to A$9.5 million, on June 30, 2026, and that the amount would now be written off. The decision updates the value of an investment linked to a case in which the funded party was unable to continue its challenge. The disclosure did not name the party or the case. The announcement comes as the company deals with the outcomes of cases in its portfolio and a plan to manage existing investments through to their conclusion.
Results for the financial year ended June 30, 2026, show the scale of the pressure preceding this disclosure. The company reported a post-tax loss of A$165.7 million, compared with a loss of A$72.9 million in the previous year. The annual loss therefore more than doubled, according to the figures in the company’s results. Its position also shifted from net assets of A$114.4 million in the comparative year to net liabilities of A$53.6 million on June 30, 2026. These results put the new investment write-off in the context of a year in which the portfolio declined in value and the balance sheet moved into net liabilities.
For investments concluded during the financial year, the company closed 8 investments, 7 of which ended in losses. Net realised losses on concluded investments were A$63.9 million, compared with net realised gains of A$22.2 million in the previous financial year. The company said performance was affected by a large amount of invested capital being concentrated in a small number of cases that concluded unsuccessfully. This concentration indicates that the outcomes of a limited number of matters carried significant weight in the portfolio’s results during the year. The investment now to be written off adds to the risks associated with the outcomes of cases funded by the company, although the disclosure did not link the write-off to a specific financial period impact.
Litigation Capital Management is now managing a strategic transition after a review that did not result in a transaction. According to its results, the existing portfolio will be managed through to the conclusion of its investments, and the company will make no new investments. It also said cash realised from the portfolio would first be used to repay the debt facility. The plan shifts the company’s focus from deploying new capital in cases to realising value from existing investments and managing their maturities. In this context, the outcomes of funded disputes and the timing of cash realisations are direct factors in the portfolio wind-down and debt repayment, in line with the priorities the company announced.
On financing, amendments to the Northleaf facility increased its size from US$100 million to US$125 million and extended its maturity date to December 31, 2030. In a separate disclosure, the company said the extension of the short-term waiver reflected that the conditions precedent to the long-term amendment announced on September 30, 2026, were close to completion. The company set November 13 as the expiry date for the waiver extension, with attention focused on completing those conditions before then. During the extension period, the higher interest rate remains in place, according to the context of the disclosure in the event details. The portfolio wind-down is therefore linked to the company’s plan to amend the debt facility and repay it with realised cash.
The company’s shares closed at 0.58 pence on November 9, up 21.05% during the session, according to Sharecast data. The close marked a daily gain of 0.10 pence, according to price data published for that day. The move came in the same session as the disclosure that permission to appeal had been denied and the investment would be written off. The disclosure does not specify the reason for the share-price move, so it is noted here only in terms of the recorded price and change. The next financing-related step will be completing the conditions precedent to the long-term amendment before the waiver extension expires on November 13.