Local legal financier raises over R145m for commercial litigants

Gary Sweidan

● The funds are now available to finance high value commercial litigation cases

● Taurus Capital is the first in its sector in South Africa to raise a fund

The largest litigation fund of its kind in South Africa recently closed with a total fund-raise of R145 800 000.

Taurus Fund One raised by Taurus Capital is a litigation fund available for high value commercial litigation matters in South Africa. The availability of the funds provides a war-chest to litigants which can be used to bolster the quality and experience of the legal team and experts, if required. It is the only litigation fund in the country that funds a portfolio of matters, as opposed to raising funding to litigate case by case.

Litigation funding is an investment in a claimant’s litigation in return for a share of the proceeds, provided the claim is successful and recovery is made. This type of transaction  has been permitted in South African law since 2004 and has  recently been gaining traction in the market. Through this transaction, Taurus Capital is able to provide a litigation funding solution to law firms and litigants. It provides a well-considered risk-adjusted solution which assesses cost versus risk and return which aligns the interests for the litigant, legal representatives  and financier.

Partner at Taurus Capital, Gary Sweidan says, “The interest shown by investors during this fund-raise highlights the demand we are seeing for alternative investments among high-net-worth individuals, private equity investors, and family offices. The fact that we were oversubscribed by 30% is an encouraging sign of investor appetite in South Africa.

He further says, “What the success of this fundraise means is that we are now well placed to assist litigants in funding high value commercial litigation in South Africa. Litigation is expensive and the costs escalate the closer a case gets to the hearing. We give litigants the opportunity to engage or retain the best attorneys and counsel available and have the confidence to litigate with the knowledge that they will not be outmuscled legally or financially.”

The availability of funding specifically for legal cases is good news for the legal profession. “Too often meritorious legal matters never reach our courts because the money needed to pay for the litigation process just isn’t available,” Sweidan explains.

“Attorneys who may, reluctantly, have had to turn away potential clients in the past are now able to take clients on because funding is available for suitable cases.”

When determining which matters to fund, Taurus Capital is guided by its legal risk and investment committees made up of experienced lawyers, accountants, businessmen and private equity professionals.

“Ultimately,” Sweidan concludes, “this is about providing greater access to the country’s legal system, while at the same time providing a very attractive investment opportunity for private investors.”

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