Crystal Amber reinstates management fee post-2023 as wind-up continues
The first formal fee review will be made in line with the half year financial results due in March 2024 and at “regular intervals thereafter”.
The previous investment management agreement (IMA) allowed for a management fee until 31 December 2023, after which point it was expected that the trust would no longer require substantial management.
However, the managers have continued to take «opportunistic investments» in existing holdings, and as such, the board believes it «remains in the best interests of the fund to retain the services of the investment manager until the fund's portfolio is realised».
Crystal Amber pledges 'substantial return of capital' following Hurricane Energy sale
The decision to return capital to investors via timely disposals was first proposed after the trust failed its continuation vote on 22 December 2021, and was confirmed at an extraordinary general meeting on 7 March 2022.
In accordance with the new IMA, the investment manager will be entitled to the same annual fee as it will receive over the calendar year 2023.
However, while in 2023 the monthly rate was reduced in three stages, from £70,000 for H1, to £50,000 for Q3 and £40,000 for Q4, in 2024, the monthly fee will be averaged out to £57,500, subject to review.
This equates to a management fee of approximately 0.83% of the vehicle's current net asset value of £83m at 30 September 2023, according to its final results for the year to 30 June 2023.
The first formal review will be made in line with the half year financial results due in March 2024 and at «regular intervals thereafter».
Crystal Amber's managers will also remain entitled to a performance fee of 20% of the aggregate return of cash paid to shareholder after 1 January over a hurdle
Read more on investmentweek.co.uk
