Case Study – Private Equity Fund Manager Terms – FTSE Listed Private Equity Trust

Brief

In recognition of a change in the investment policy of the Trust, advise the Board on the appropriate structure and terms relating to the re-appointment of the independent fund manager.

Solution

  • using existing market knowledge, provide advice on the appropriate levels of remuneration as well as the terms and structure of that remuneration for the fund manager
  • in particular advise on levels of management fees, performance fees (i.e. the Carry) including hurdle rate and catch up mechanism, the GP commitment and treatment of transaction fees, monitoring fees and abort fees
  • advise on termination clauses
  • assist in negotiations with the fund manager, including attendance at meetings with the Board and with other advisors as well as with members of the fund management entity
  • prepare opinion letter and report used as basis for statements made in the shareholder circular
  • review and comment on legal documentation as well as shareholder circular