Partners Group Private Equity Announces Revised Investment Management Agreement
Why we think this is good
The changes to the investment management agreement between PGPE Ltd and Partners Group are expected to reduce the fees paid to the Investment Manager, which should be accretive to shareholder returns. The new incentive fee structure is also more aligned with the overall NAV performance of the company, providing better incentives for the Investment Manager to deliver strong portfolio-wide results. While the lack of financial details and external analysis makes it difficult to quantify the full impact, the changes appear positive for shareholders.
Key Points
- Revised investment management fee calculation to exclude temporary investments and unfunded commitments, and focus on the NAV of direct investments
- New incentive fee structure based on the overall NAV performance of the company, with a high-water mark and annual cap
- Investment objective and policy updated to focus solely on private equity direct investments, removing the ability to invest in other private markets
Summary
Partners Group Private Equity Limited (PGPE Ltd) has announced changes to its investment management agreement with Partners Group, the Investment Manager. The key changes include a revised investment management fee calculation focused on the NAV of direct investments, and a new incentive fee structure based on the overall NAV performance of the company. The Board believes these changes will reduce the fees paid to the Investment Manager in an average year and better align their interests with those of shareholders. Additionally, the company's investment objective and policy will be updated to focus solely on private equity direct investments.