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In this piece, we discuss Investors pledging their interests in private equity funds to secure their own indebtedness and the corresponding impact on the subscription facility market, including exclusion event considerations.
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When thinking, talking and writing about subscription credit facilities, the fund in question usually has a diversified group of investors with a wide range of commitment sizes – those funds are commonly referred to as “commingled” funds. On the other end of the spectrum are funds consisting of just one investor (or just a handful of investors) – those funds are commonly referred to as “SMAs” (Separately Managed Accounts). Why do SMAs exist and why would a lender lend to a “fund of one”?
The U.S. chapter of FFA Next Gen held its second virtual panel session this week, titled “Into the Unknown”: A Fund Finance Perspective on “Letting LIBOR Go.” Over 215 attendees heard from expert panelists Jean MacInnes, Executive Director and Counsel at Mizuho Americas, Jeff Nagle, Partner at Cadwalader, and Tess Virmani, Associate General Counsel and Executive Vice President for Public Policy at LSTA. I appreciated the opportunity to serve as panel moderator. Read on for some key takeaways.
Leah Edelboim has joined Cadwalader’s Fund Finance practice as a special counsel in our New York office. She joins from Clifford Chance, where she represented funds and lenders in fund finance transactions for nearly a decade.
Last week, the Diversity in Fund Finance group partnered with PENCIL, the NYC-based non-profit whose mission is to provide New York public school students with access to relationships and opportunities with business professionals. In conjunction with PENCIL’s internship program, PENCIL provides hundreds of students with 20+ hours of pre-employment career readiness training. These trainings cover a variety of topics that help equip students with crucial skills needed to succeed at their summer internships.
Join Women in Fund Finance’s global #ChooseToChallenge campaign, starting March 8. Enter as an individual, friends and family team, or corporate team for a 10-day push-up and/or meditation challenge. All donations received will go to the Malala Fund, supporting the right to 12 years of free, safe and quality education for every girl. For more details, click here.
Aberdeen Standard Investments outlined the benefits of a growing trend among middle-aged funds in utilizing NAV lending to fill its liquidity gaps accelerated by the coronavirus pandemic. The coronavirus pandemic caused many middle-aged funds to use their remaining capital to defend portfolio companies' value, leaving them with limited liquidity to continue funding buy-and-build strategies.
Secondaries Investor recently published an article that contained an interesting and detailed discussion about the movement of the market toward NAV facilities over the course of 2020, with some key market players from Investec, Crestline Investors, 17Capital and Hark Capital participating in the article. The article can be accessed here.
Brickfield Recruitment’s latest article tackles the seasonal nature of recruitment in fund finance (as peak hiring in March approaches), as well as the key issue of timing in recruitment. This article is the first in a two-part series from Brickfield on recruitment processes and relationships.
The Lawyer published an article by Jad Nader (Ogier) and Phil Cody (Arthur Cox) comparing fund finance considerations under the legal frameworks of Ireland and Luxembourg. The article details key issues to consider when an Irish or Luxembourg fund is a borrower or other obligor in a fund finance structure, and notes the preferred status of Ireland and Luxembourg as jurisdictions to establish European funds.
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Finance lawyer Alice Wight has joined Walkers' leading Banking & Finance team in Jersey.
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