Muddy Waters shorts Burford

Burford  Capital, litigation financing specialist lost half of its market value after Muddy Waters a prominent US short-seller   took aim at a favourite of London’ stock market.

The US hedge fund, headed by Carson Block, described Burford as a “poor business masquerading as  a great one” in report that sent shares  in the company down 46 per cent.

Burford who had Neil Woodford among its largest shareholders, makes money by  funding lawsuits and then taking a share of any proceeds. The litigation finance industry has been boosted by era of low interest rates.  Burford’s value has dropped by £1.7bn in two days.

Until this week Burford’s  market value was more than £3bn, making it the largest stock listed on Aim, the London Stock Exchange’s market for smaller growth companies.