Emmerson PLC (AIM:EML) shares rose on Thursday after it announced it had secured a Capital Provision Agreement (CPA) with a specialist litigation funding firm.
It will provide up to $11 million of non-recourse funding to cover Emmerson’s arbitration costs and working capital needs.
The funds, made available in tranches, will support Emmerson’s arbitration under the Bilateral Investment Treaty between the UK and Morocco, following a dispute with the Moroccan government.
The litigation finance provider will not receive any return if the claim is unsuccessful.
Emmerson also noted it had appointed Boies Schiller Flexner LLP (BSF) as its litigation counsel.
BSF is recognized for its expertise in Bilateral Investment Treaty arbitration cases and has achieved notable success in similar disputes. Work on the case will commence in early 2025.
"The company has undertaken a tremendous amount of work and effort in a short period of time to secure substantial financing from a reliable funding partner,” managing director Graham Clarke said in a statement.
“This CPA secures the medium-term future of the company and we can now move forward with BSF as our legal partners to deliver the best possible outcome for the company and its shareholders. BSF tend to only take on winning cases and their confidence in the case reinforces our confidence in the outcome"
In London, Emmerson shares shot up some 39% in Thursday morning’s dealing to change hands at 0.85p each.