Restructuring work carried out by Carey Olsen’s corporate team in Jersey has revived the fortunes of Close Global Funds, Close Brothers' flagship offshore investment vehicle, lifting the suspension of trading of the main fund on the CISX.
Close’s Rex Cowley said: “2009 saw an unprecedented retraction in liquidity in capital markets. This created significant issues for our flagship Multi-Asset fund of fund range within the property and hedge fund sectors due to high suspensions and closing rates which has not been seen before.
“Our objective was simple, we had to protect the interests of our shareholders and retain liquidity within our fund range. Carey Olsen assisted us with a full restructure of our open-ended umbrella fund which enabled us to meet our objectives without the degradation of the share price to the affected funds.”
Lead partner Eve Kosofsky said the work carried out was a good example of Carey Olsen providing a seamless service to a client with very specific and immediate needs.
“Restructuring the fund in this way has enabled it to continue operating. We have already seen the suspension of trading lifted as well as a significant distribution from one of the side pockets.”
Eve Kosofsky said ‘side pockets’ were a growing trend in investment fund work.
“We have seen an increase in this structuring as investment vehicles seek to mitigate the effects of the downturn. Side pockets are an effective way of dealing with illiquid assets; isolating them from the main investment fund enables that fund to continue performing whilst these assets gradually recover their value.”
Mr Cowley stressed that the firm’s understanding of regulation and the mechanics surrounding offshore collectives was critical to the success of the restructuring.
“Carey Olsen’s proactive and solution-driven approach was vital to this outcome. Both the commercial consequences for the fund and the shareholders, together with our organisation’s reputation, benefited positively from this exercise at a time when any such outcome should have been seen as highly unlikely.”