Ares Management Corp., a leading alternative asset manager, has announced its first foray into the litigation finance sector through a notable agreement with Omni Bridgeway. This transaction marks a strategic move for Ares as litigation finance continues its ascent as a viable investment field, currently estimated to be a $15.2 billion industry, a stark increase from $9.5 billion just five years ago.
This partnership sees Ares acquiring a significant stake in Omni Bridgeway’s ongoing investments. Omni, known for its robust presence in the litigation finance arena, takes on the risks associated with upfront legal costs in anticipation of potential returns contingent on successful legal outcomes. This investment strategy has seen increased traction and acceptance in the financial world as stakeholders recognize the high-stakes returns possible through strategic legal finance management.
In addition to this pivotal acquisition, Ares has also recently secured NFL owners’ approval for a 10% stake in the Miami Dolphins, further diversifying its investment portfolio. The specifics of the deal with Omni Bridgeway detail Ares holding a commanding 70% stake in a newly established fund between the two entities, reflecting their committed interest in litigation finance’s growing potential.
The implications of this development for the legal finance sector are manifold, highlighting a trend towards mainstream financial entities engaging in and supporting legal financing as part of broader strategic diversification. For more in-depth coverage, visit the original Bloomberg Law article.