End of Fund Life Solutions
Cork Gully advises investment managers on the development and implementation of tailored strategies, with a particular focus on challenged and/or tail-end fund solutions. Our goal is to work alongside investment managers to reduce costs and maximise returns whilst providing liquidity solutions for partners locked into existing fund structures. There are often many reasons for the term of a fund to be extended, such as the retention of minority interests which cannot be readily sold, earn-outs or outstanding litigation. Despite this, both managers and investors need a solution to unlock their investment.
Acting as fund sub-advisors or co-partners
We are able to work alongside incumbent investment managers as sub-advisor or co-partner to provide a range of bespoke services including:
- strategic planning and options analysis for tail-end funds;
- communication and negotiations with key stakeholders, including regulators and investors when winding down a fund;
- evaluation of existing asset realisation plans and the use of special purchase vehicles to warehouse assets;
- assistance with the implementation of wind down plans; and
- provision of liquidity solutions to assist with realisation of illiquid assets.
Tail-end or challenged funds
Our situational experience, particularly our focus on mature and tail-end funds that are nearing the end of their life cycle, helps us to assist investment managers with the planning and implementation of cost reduction plans as assets under management decrease to ensure maximum returns for investors are achieved through the managed disposition of residual assets and portfolio companies. We use special purpose vehicles to warehouse illiquid assets and the establishment of a liquidating trust where appropriate, allowing the fund to be dissolved. We can also assist in the soft wind down of the fund and its ultimate solvent liquidation across multiple jurisdictions including Guernsey, Jersey, Luxembourg, Cayman Islands and Mauritius.
We are able to leverage our extensive global network and secondary market contacts, to bring bespoke solutions to investment managers, general partners and limited partners including buy-out options, the sale of single assets and portfolios. We bring robust independence to the management of portfolio valuations, general partner investment acquisition and profit share monetisation plans. Our multi-disciplinary, senior team has a deep understanding of the operational, legal, regulatory and cultural challenges impacting funds across the world.
Wind down planning
We will work with fund managers to formulate a wind down strategy and implement it over the necessary time period. Cork Gully can provide support through every stage of a controlled wind down, from planning and execution of the wind down plan, through to the ultimate dissolution of the fund.
A robust wind down plan and timeline will assist with closure in a timely and orderly manner. The plan will consider the scale of the fund operations to be wound down. The plan will consider the timing and strategy to be adopted, with particular attention to the complexity of the residual assets and other matters that might impact their realisation, for example, jurisdictional or litigation issues. A wind down plan will also address other key factors such as communication with stakeholders and other legal, tax and regulatory considerations.
Cork Gully can assist with preparation of a full wind down plan and timeline for agreement by key stakeholders or with undertaking an independent assessment as to the reasonableness of existing planning activities. Cork Gully have a proven track record of preparing, reviewing and implementing wind down plans in an effective manner to maximise the benefits to key stakeholders.
Cork Gully undertakes formal liquidation appointments across a number of jurisdictions to assist funds to wind up in an orderly manner, returning surplus assets to investors. The primary duties of the liquidator will be to implement realisation strategies for all remaining portfolio assets and resolve all other barriers to the formal dissolution of the fund.
It is important that all outstanding financial obligations and liabilities are discharged prior to dissolution. This includes contingent claims against the fund. Cork Gully are expert in dealing with potential litigation and claims management to assist with this process. A final liquidation audit may be required and the liquidating manager will then arrange for payment of final investor distributions. Consideration will be given to regulatory and statutory duties, including the retention of books and records.
"We advise investment managers and investors on the development and implementation of tail-end fund solutions"