Our expertise includes advising and documenting all aspects of fund finance, including:
- Capital call facilities
- Fund margin lending
- Investment manager fee income loans
- Investment trust loans
- Financial collateral arrangements advice and analysis
- Funds due diligence.
In addition, we regularly act for funds as alternative bank lenders including in relation to acquisition finance, emerging markets lending, mezzanine finance and real estate finance.
Capital call facilities
Our experience covers the full range of domestic and international capital call facilities, including the due diligence required on fund ownership and investment structures. We are familiar with the capital call facility structures typical in the United States and have advised on English law aspects of many such facilities.
Fund margin lending
We are one of very few international firms with a genuine focus on this type of lending and have advised on transactions ranging from short term unsecured liquidity transactions to $1bn single fund asset secured cross border deals. We have also developed the standard lending documentation for a number of financial institutions and regularly provide strategic advice and lectures to clients in addition to negotiating and documenting transactions. We understand and can help clients with navigating the key negotiation points which include, drafting the appropriate margining provisions, the valuation of fund units (and what happens in circumstances where NAV is suspended or gating provisions apply) and assessing and drafting the eligibility of fund collateral and portfolio limits.
Investment manager fee income loans
We have a strong track record advising on loans to hedge fund managers where a lender takes security over future management fee income. We are aware of the competing commercial and legal requirements having represented both lenders and borrowers on these matters and accordingly help drive solutions.
Investment trust loans
We have acted for a number of international banks lending to UK listed investment trusts and are familiar with typical market covenants.
Financial collateral arrangements advice and analysis
Structuring a transaction to qualify as a financial collateral arrangement under the Financial Collateral Arrangements (No.2) Regulations 2003 is often important to clients and we regularly advise and opine on these matters.
Funds due diligence
Our clients often require due diligence questionnaires to be completed in respect of hedge fund clients. Our funds formation experience means we can complete this quickly and efficiently and add value in terms of the credit analysis over and above typical reporting standards.
Our funds finance experience includes:
- advising an international investment bank on an USD1bn loan to a Maltese hedge fund, secured on units in a German special fund
- advising an international lender and custodian on committed revolving loan facilities secured on a portfolio of interests in hedge funds
- advising a US lender on a USD 600m capital call facility to a real estate fund
- advising a UK lender on a EUR standby letter of credit facility to a Luxembourg corporate borrower, secured on US and European investor capital call rights held by English and Cayman limited partnership guarantors
- advising an international lender on a number of unsecured loans to UK investment trusts
- advising BlueCrest, the hedge fund, on the financing of the acquisition of Man Group's stake in BlueCrest, shortlisted for, "Banking and Finance Team of the Year" 2011 at the British Legal Awards 2011 and Legal Business Awards 2012
- advising an international bank in respect of a EUR 300m capital call facility to a Luxembourg fund to enable the financing of an acquisition.