End of Life and Wind Down Solutions for Funds
Our R&H wind down services team advises investors, investment managers and general partners on end of life solutions for Cayman registered fund structures, preserving value for stakeholders by facilitating cost rationalization, managing illiquid assets and navigating through a variety of challenges which many structures face as they reach the end of their economic life.
The R&H wind down services team draws upon our diverse pool of fund and liquidation specialists within the Rawlinson & Hunter Cayman grouping to provide our clients with tailored and bespoke wind down services under one umbrella. Our team regularly assists fund clients with the following common challenges as structures contemplate wind down.
Cost Rationalization:
The costs of maintaining a structure at the end of life are often onerous and if left unchecked can erode final returns to stakeholders.
Our team has decades of experience acting as wind down agent and voluntary liquidator to CIMA registered and non registered funds, helping clients rationalize costs and internal resources to other arears of their business. We are regularly retained during the voluntary liquidation process to provide fund administration services to clients in liquidation, helping to further consolidate service providers during the liquidation run off period whilst maintaining investor reporting levels.
We can also provide CIMA registered directors, registered
office, AML compliance officers and other ancillary services to structures in wind down to ensure ongoing compliance with applicable regulations. Our team assists clients with investor and limited partner due diligence remediation to streamline the interim and final distribution processes which can be time consuming and complex particularly when a structure has been operating for some time or the wind down has been protracted.
Illiquid Assets:
Often our clients are faced with the challenge of balancing the costs of maintaining a structure versus maximizing potential asset recoveries when the remaining assets of the fund do not have liquidity.
We work with clients to find solutions for illiquid positions in order to develop either an exit strategy via secondary market buyers or facilitating portfolio sales.
We also establish and manage liquidating trusts in scenarios where either short-term liquidity cannot be achieved or there is a desire to hold a position through to maturity. This can be achieved alongside a voluntary liquidation of the structure, which reduces ongoing costs and allows the fund vehicle to be wound up without losing asset value.
Under Performing Assets:
Value may be being eroded by assets which are under performing and require restructuring or more active management.
Our team is able to take a hands-on and proactive approach to managing underperforming assets, taking on a variety of roles to advise clients dealing with underperforming assets within their portfolios.
We are able to leverage our global Rawlinson & Hunter network as well as the HLB International global accountancy network where specialists from outside of the Cayman Islands are required.
Our solutions are tailored to our clients’ needs. For example, we have worked with clients to facilitate the full handover of a structure’s operations during the wind down phase, allowing the incumbent investment manager to focus on new projects safe in the knowledge that the legacy structure is wound down in a compliant, efficient and cost effective manner for stakeholders. In other scenarios, the incumbent fund manager, with its historic knowledge of the portfolio and relationships with investors, has worked alongside our team to deliver value enhancing solutions, maintaining oversight of the process. In each case our team has been successful in winding down many funds efficiently and maximizing millions of dollars in remaining assets.
Our team provides a seamless transition of services which rationalize costs whilst maintaining investor relations in what can be uncertain times for stakeholders. These services also allow our clients to manage the regulatory burden and risks of non-compliance during the wind down process.
Our wind down services include:
- Experienced voluntary liquidators (from an entity with supervisory oversight from CIIPA)
- CIMA regulated and fully licensed fund administration services
- Registrar and transfer agency services
- CIMA regulated trustees and fiduciary services
- CIMA registered directors
- Licensed registered office services
- AML and compliance services
- Investor and limited partner due diligence remediation
- Custody services for illiquid fund of fund positions
- Secondary market sale facilitation
- Compliance advisory services including FATCA/CRS, beneficial ownership and economic substance
The ability to leverage this deep pool of professional talent across various specialist service lines means we are uniquely placed to help our clients appraise their wind down options and deploy a solution which is value enhancing and beneficial to investors.
