With institutional investors increasing allocations to real assets to combat a persistent low-yield environment, this report look at how Luxembourg has established itself as the jurisdiction of choice for managers looking to set up PE and VC funds…
The 'Luxembourg 2019 – Special Report' special report comprises 11 separate articles listed below, these can be read individually or as a sequence.
As institutional investors have been increasing allocations to real assets, driven by the persistent low yield environment, the appeal of private equity (PE) has inevitably been on the rise. Luxembourg has become the European epi-centre of this burgeoning industry as its reputation for quality and service precedes it.
No matter who you talk to, global private equity has enjoyed a period of enormous growth in the last few years and, in Luxembourg, this has proven to be a key factor as it has looked to drive interest, globally, in regulated private equity funds.
As the private capital markets develop further and regulation continues to increase, asset servicers shoulder growing reporting and supervisory burdens on behalf of their clients. As a result, an automated technology solution to manage the sheer volume of data needed to invest in this area can provide operational efficiency and also allow for more cost effective investment by limited partners (LPs).
Industry players in Luxembourg are sharpening their need for outsourced IT solutions as they scale up their operations driven by regulatory demand and growth in the jurisdiction.
Q&A with Mark Shaw, Partner, Wildgen Investment Fund…
Fund administrators are moving up the chain into middle office and portfolio management functions as they broaden their services to offer more holistic support to their asset management clients. The success of this is currently reliant on a strong human relationship between administrators and fund managers. However, as the alternatives industry moves to more standardisation, technology will play a greater role in helping fund administrators provide a superior service to their fund management clients.
The private equity, private debt and real estate fund markets are growing strongly across the globe. Record amounts of assets are flowing into these asset classes as investors look to allocate to strategies which offer attractive returns in a global low interest rate environment.
As price competition increases in the provision of third party management company services in Luxembourg, the focus on quality and deep regulatory expertise is becoming even more important.
Luxembourg is seeing a growing number of US managers interested in setting up private equity structures to access European investments and clients. Richard van ‘t Hof, head of Trident Trust’s operations in Luxembourg talks about the opportunities and challenges managers face when crossing the Atlantic.
By Andrew Frost (pictured), Lawson Conner, & Justin Partington, IQ-EQ – Enhanced due diligence, including Know Your Customer (KYC), when completing complex acquisitions of businesses or assets is not only a basic expectation under current Anti-Money Laundering (AML) regulations, but also makes commercial sense for all parties involved.
The swathe of transparency disclosures required by new and upcoming regulation has been putting pressure on private equity firms. However, PE managers can work with pragmatic and knowledgeable law firms to understand exactly how the rules apply to their particular situation and consider whether there is a basis for limiting disclosure about their business and their investors.