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Can a US law firm be worth $ 33bn?

When John Ruiz set up a house on the Ritz-Carlton Lake in Miami Beach earlier this year, he met a man who later helped him become a billionaire several times – on paper.

The real estate agent was Ophir Sternberg, the founder and founder of Lionheart Capital, who along with Elliott Management’s fundraiser turned an old heart hospital into a safe haven. Villas on the site, designed by Italian architect Piero Lissoni, enjoys marine secrets and sells for about $ 40m each.

This is the first time that Ruiz and Sternberg have done business together, including in May, when they agreed to buy a Cigarette Racing Team, a high-end boat manufacturer.

But none of these sales can match what he revealed this week: Sternberg a company that creates a unique goal wants to take over Ruiz’s health care business MSP Rehabilitation of all people and save about $ 33bn.

Even in the atmosphere of the Spac boom, where companies with big dreams but small amounts of money have been announced publicly at incredible prices, the price on the MSP deal is evident.

“For a non-zero company, it’s a private class,” said Michael Klausner, a professor at Stanford Law School who studies Spacs. “The same can be real estate companies or moving cars but even cheaper. ”

A former member of the Israeli Defense Forces who turned his back on a plot of land, first in New York and then in Miami, Sternberg was initially looking for a home-based technology company to show the public. Lionheart Capital raised $ 230m in August last year and set itself at the end of 18 months to secure a deal.

After doing business with Ruiz, Sternberg changed his mind to find a target in the area and decided to join MSP Recovery instead.

The MSP reinstatement was instituted in 2014 by Ruiz, a wealthy Miami lawyer with his legal appearance in Spain The command of the TV. The company buys money from government-funded offices such as Medicare and Medicaid, before prosecuting attorneys for other cases, such as car insurance. It then claims to receive the full amount.

Lionheart has already been registered in the Nasdaq stock market and if it can complete its work with MSP Recovery, the medical team will become a state-owned company through a process known as alternative integration.

Announcing this week that Lionheart Acquisition Corporation II and MSP Recovery have agreed a deal that praises the $ 32.6bn lawsuit that did not attract the kind of advertising offered by these Spacs, though it is the second most charitable action.

John Ruiz and Ophir Sternberg teamed up in May to buy a Cigarette Racing Team, a boat-building company © Alamy

Lionheart has given MSP a Recovery of seven times the amount of money it earns in 2023, based on what can be found. A participant in the project called it an “extreme agreement” while a Lionheart psychologist said it was “apparently”.

Ruiz disagrees with this. “This is a lie. . . not based on the type we have created, “he told the Financial Times, adding that the company’s demonstrations are likely to be available for market growth. According to MSP Recovery, about 11% of $ 1.6tn Medicaid and Medicare annually can be made available.

Some of the supervisors who took part in the project have left. Three members of Lionheart’s Boardhe Acquisition have resigned since MSP Recovery and Spac signed a petition in March. Trevor Barran, former Spac boss, submitted his resignation on July 4, just days before the deal was announced. Barran did not respond to a request for comment.

The agreement comes together as the US Securities and Exchange Commission begins to take a strong thoughts on Spacs by warning them not to give false propaganda and to show that they could be held accountable for any lies about the business.

In the meantime, market participants criticized the design of Spacs, which often allows insiders to make huge profits while encouraging managers to participate in interest rates regardless of the other vendors.

Companies like MSP Recovery buy complaints at a lower cost before following the parties with the full cost and share the benefits if the lawsuits win. Business is no different and its types are increasingly common in the US.

But Ruiz says he has a secret sauce – algorithms developed by himself and a team of engineers who can search in medical journals to find allegations that it has recovered errors by the government. Obviously, this is what participants in the group receive and its benefits from the conference. The law firm becomes a business company.

MSP’s recovery, which does not expect to make any money this year, shows that its total revenue will jump from about $ 1bn next year to $ 23bn in 2026. lawmakers, including those with the same name as Ruiz, have received about 20%. The rest goes to the company.

Ophir Sternberg is a former member of the Israeli Defense Forces who turned his back on a plot of land. © Startraks / Shutterstock

For Ruiz, his calculation, if any, is very low. “My number was much higher than $ 32.6bn. We came back with the first colors, it was $ 50bn, ”he said. Ruiz called Sternberg a “smart businessman” who fought hard to sell him well.

Some forensic experts count less. Burford Capital – not uncommon for controversy – is the best known player in the industry and now has a market capitalization of $ 1.6bn or more than $ 2.2bn.

However, speaking to investors who were selected to form the alliance, MSP Recovery also said that its accounting was linked to secret giants such as Blackstone, KKR and Apollo, who saw them as allies because of their short-term wealth.

In contrast to most Spac events, not all other businesses participating in the contract, including business ventures in state-owned enterprises, or so-called Pipe investors, have added to the scam. The agreements often contain lengthy negotiations for the company’s damages, and provide a definite agreement on the agreement.

What is also needed are bulge-bracket banks that often work on these units. Keefe, Bruyette & Woods and Nomura Securities, who are among the majority shareholders in Lionheart Acquisition, were listed as financial advisors. Attorneys at the conference are Weil, Gotshal & Manges and DLA Piper, with outgoing Roger Meltzer sitting on the Spac board.

The conference has raised eyebrows, with $ 70m of $ 230m MSP Recovery expected to receive from Spac to consultants. According to Ruiz the funding is appropriate because “200 or 300 people” have been involved in the project for several months.

Sternberg says he has discussed what he considers to be a “strange surprise” for shareholders in Lionheart who support the deal instead of redeeming their money before it expires.

Non-redeeming shareholders have received at least 35 licenses, which gives them the opportunity to purchase a portion of the MSP Recovery stock for $ 11.50 even though the market price is worth more than that.

In an unusual move in a deal like this, MSP Recovery said Ruiz and other executives had agreed to sell the company on any available investment basis, instead of having a company offer new shares and reduce shareholders.

“The MSP shareholder is transferring profits to Lionheart shareholders who do not redeem as a way to help them accept MSP accounting,” said Klausner, a Stanford professor. “The most straightforward way to reduce redemption is to set the price of the MSP at a level that Lionheart’s allies can accept.”

However, whether investors save or leave is not really helpful, according to Sternberg. “The alliance is moving regardless,” he said.

If so, Ruiz will increase his share of the company – a fortune worth more than $ 20bn on writing – to his fortune, making him one of the richest men in Floridians, according to local television.

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