The IMF Bentham Ltd (ASX: IMF) share price recovered its losses on Friday to close flat at $3.40 per share after the company’s latest acquisition update.
What did IMF Bentham announce?
On Friday afternoon, Aussie litigation funder IMF announced that it has completed the acquisition of Omni Bridgeway Holdings B.V.. The acquisition was announced on 15 October and IMF has now paid the $50.28 million to Omni Bridgeway shareholders.
Omni Bridgeway is a litigation funder and IMF is hoping to accelerate its growth through the purchase. IMF is seeking to build a “diversified global litigation funding platform across common law and civil law jurisdictions.”
Friday’s announcement finalises the acquisition, despite some further consideration involved in the deal.
Omni Bridgeway shareholders are entitled to additional deferred consideration over the next 5 years and contingent consideration based on certain milestones in the next 5 years.
The IMF Bentham share price fell in early trade before recovering to close flat at $3.40 after the announcement.
How has the IMF Bentham share price performed in 2019?
2019 was tipped to be a bumper year for IMF Bentham following the 2018 Financial Services Royal Commission.
The revelations from the Royal Commission had many expecting litigation funders to swoop in this year. While that has been the case in part with several class actions being filed, 2019 hasn’t quite delivered for shareholders.
The IMF Bentham share price is up 9.87%, year to date, which is significantly under the performance of the S&P/ASX 200 Index (INDEXASX: XJO) this year. The ASX 200 has returned a tidy 20.81% in 2019, despite a few hiccups along the way.
Long-term investors in IMF Bentham would still be sitting nicely, however. The IMF Bentham share price has more than tripled since hitting $1 per share back in February 2016.
The company is also yielding 1.47% per annum, which is nothing to be sneezed at in a low interest rate environment.
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Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.