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Promethion Limited

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Establishment of an Irish umbrella fund: in-depth understanding of hedge funds and the fixed income market, broad documentation and product skills.

Problem

The client fund manager needed to develop new product offerings and structured products to broaden its distribution base.

The client had successfully developed its managed account offering and the CDO platform and needed an absolute return strategy which would appeal to a different set of investors.

The fund platform had to be flexible to allow addition of new fund strategies to generate economies of scale.

Solution

Promethion designed the strategy in conjunction with the lead portfolio manager.

Wrote the prospectus and negotiated the custody, administration, ISDA, GMRA and futures documentation with counterparties.

Reviewed service providers and prime brokers and coordinated implementation of the operational platform.  


Financial Impact

Promethion raised €50 million of seed capital for the hedge fund.

This generated annual fees of 1.5% for the manager with an additional 20% upside above the fund's hurdle rate, representing a minimum addition to pre-tax income of €750,000.

The initial 2 year seed period laid the foundation for the manager's track record as a long-short manager and gave them the ability to draw additional funds to the group.