Morgan Stanley’s Strong to Join Longford Capital as Chairman

Mar 31, 2014 4:39 pm ET

(Updates with Strong comments starting in second paragraph.)

March 31 (Bloomberg) -- Bill Strong, the retiring co-chief of Morgan Stanley in Asia Pacific, will join litigation investment firm Longford Capital Management LP as chairman.

Strong, 61, starts at Longford on May 1, he said in an interview today at Bloomberg LP’s headquarters in New York. Longford, based in Chicago, invests in corporate legal claims with the aim of profiting from favorable settlements and awards.

Litigation finance is an industry that can grow similarly to private-equity’s expansion after the 1980s, said Strong, who joined Morgan Stanley in 1993 to run North American investment banking offices outside New York. Longford, founded last year, joins firms such as Burford Capital Ltd. and Juridica Investments Ltd. in raising money from clients seeking an investment strategy that’s uncorrelated to the stock market.

“Purely as a business matter, it was the best opportunity for me after Morgan Stanley,” said Strong. “The demand for litigation finance vastly outstrips the supply, so I think the asset class will grow significantly.”

Brothers Timothy and Bill Farrell and their partner Michael Nicolas started Longford in January 2013. The firm has made eight investments after examining 80 potential deals, Bill Farrell said in an interview. He declined to discuss Longford’s fund structure or money raising.

Burford Profit

Burford, which trades publicly on the London Stock Exchange’s AIM market, today said 2013 pretax profit rose 25 percent to $42.5 million from the previous year. The London- based litigation investment firm started in 2009 with $300 million and has put $419 million in 59 deals.

Strong became co-chief executive officer of Morgan Stanley’s Asia Pacific business in 2011, overseeing the company’s expansion in Indonesia and its exit of operations in India as it sought to cut costs and improve return on equity. He was previously head of international investment banking at Salomon Brothers, based in London.

He joins a growing number of investment bank executives who are moving to investment firms. Carlyle Group LP last week hired JPMorgan Chase & Co. executive Mike Cavanagh as co-president, and buyout firm Apollo Global Management LLC looked to Goldman Sachs Group Inc. in 2010 to hire Marc Spilker as president. Spilker is leaving Apollo in May.

Strong will be based in Chicago and participate in Longford’s daily investment decisions, Farrell said. The firm focuses on business-to-business claims with more than $25 million in dispute, as well as antitrust and intellectual property claims. Farrell said he expects the first litigation decision in a Longford investment this year.