CACEIS NEWS 48 EN

No. 48 - January 2017 - caceis news 5

CACEIS, as part of Crédit Agricole’s Private Equity Services sector, partners in the development of investment funds

As part of Credit Agricole’s Premium Clients Solutions, the Private Equity Services sector combines the expertise of CACEIS, Crédit Agricole CIB and Indosuez Wealth Management to meet the financing and servicing requirements of investment funds.

fields. CACEIS is the number one depositary in France for private eq- uity, private debt and infrastructure funds, and is one of the leading players in Europe. In order to better serve its clients, “CACEIS has set up a dedicated private equity and infrastructure funds team, which includes all sup- port and operational functions,” Laurent Durdilly notes. In this way we do not see ourselves only as a service provider, but also as a partner that supports management companies in their development. Since the business line was set up, approximately twenty joint deals have been concluded, mostly in Europe (France, Luxembourg, United Kingdom, etc.); however, the joint offering is also being met with success in the United States

© Dominique Amphonesinh

T his business line has a joint approach to private equity, private debt, infrastructure and real estate funds, all of which have developed strongly in recent years across the world. At present, financing of the global economy relies to a large extent on this class of unlisted asset, which has experi- enced growing success. One of the drivers of this asset class’s success is that it offers some of the highest market returns (compared to listed assets) whilst being a low volatil- ity investment. Another factor is that public authorities are increas- ingly looking to the private sector to contribute to financing the real economy. Infrastructure funds in particular are being called upon to finance the energy transition. These funds are experiencing rapid growth and need the support of a re- liable, long-term partner through- out their lifecycle. This is where the Private Equity Services sec- tor of Crédit Agricole’s Premium Clients Solutions is involved, com- bining the expertise of its three players. Indosuez Wealth Management, the Crédit Agricole group’s wealth management arm, offers its specif- ic expertise to support the invest- ment fund managers, in particular

regards financing their carried in- terest. To ensure managers meet regulatory requirements intended to align their interests with those of unitholders, they are required to personally invest a minimum of 1% of the fund’s total assets. Indosuez Wealth Management can help them define the best suited solution de- pending on their financial status. During the fund’s early stages, Crédit Agricole CIB also contrib- utes its expertise by providing in- vestment and acquisition advice, as well as by financing LBO deals over the investment period. It also offers liquidity solutions (refinanc- ing, trade sales, a new LBO or an IPO) during the fund’s divestment phase. CACEIS is involved at several levels: in particular as depositary and registrar when the fund is es- tablished, then as administrator throughout the life of the fund. CACEIS is in charge of managing relationships and flows between the management company and the fund’s investors. CACEIS and Crédit Agricole CIB, the Crédit Agricole group’s cor- porate and investment banking arm, provide equity bridge financ-

LAURENT DURDILLY , Head of PERES Global Services, CACEIS

ing on a joint basis. As Laurent Durdilly ,Head of the business line at CACEIS, points out: “Equity bridge financing is a short or medium-term (two to four years) facility made available to investment fund man- agers. It is designed to optimise the management of the financial flows between investors and the manage- ment company, such as those related to company acquisitions and man- agement fees. Such financing has several advantages for investors and fund managers: it makes it possible to postpone and reduce the number of capital calls to investors. This im- proves the fund’s internal rate of re- turn and is also greatly appreciated by investors because it enables them to plan calls for funds.” Ranking among the leading service providers on the market, the three partners offer a comprehensive

and robust servicing solution pro- vided by experts in their respective

Fund investors

Financing solutions for the partners

IPO & Disposal

COMPREHENSIVE SOLUTION AT THE CORE OF THE FUND’S LIFE

Advisory & acquisition/ project nance FX/Cash Mgt

Fund structuring, administration and servicing

Fund nancing solutions

Interviewwith Stéphane Barret, Head of the Private Equity Services sector, CA CIB, and Emmanuel Simon, Head of Major Clients Development at CA Indosuez Wealth (France)

Emmanuel Simon - The integration of CACIB, CACEIS and Indosuez Wealth Management into the Private Equity Services sector of Premium Clients Solutions makes sense on the basis of the complementarity of both their expertise and their products and services.

Emmanuel Simon - We provide fund managers with a wide range of high added value wealth management services, including legal and tax advice, access to our investment vehicles and various customised financing solutions. We offer them access to services traditionally intended for existing family fortunes. IndosuezWealth Management has a strong international presence, with almost 2,700 employees in 14 countries; accordingly, foreign managers can benefit from local expertise backed up by the reach of the global network of the IndosuezWealth Management group and Crédit Agricole. What is your assessment so far, six months after the creation of the business line? Stéphane Barret - The results are very positive; we have seen the creation of a strong team spirit and genuine enthusiasm. Business is developing, with exponential growth as regards private equity, infrastructure and real estate funds, which is a sign that management companies find our joint offering attractive. Our development plan is ahead of schedule, in particular internationally, with a very buoyant US market. We have teams in Paris, London and NewYork and we plan to strengthen them. Emmanuel Simon - We are very satisfied with this joint approach, which enables our clients to benefit from a comprehensive service package that no other player is currently in a position to offer. The results are very encouraging. For our wealth management business line, it is very rewarding to provide support to this client segment that is closely involved in developing the real economy

STÉPHANE BARRET

EMMANUEL SIMON

© Crédit Agricole CIB

© Crédit Agricole Indosuez Wealth

How have your respective institutions integrated the Private Equity Services sector of the Premium Clients Solutions division? Stéphane Barret - The decision to pool the expertise of the three service providers was taken by our shareholder, Crédit Agricole, and is part of a comprehensive response to the needs of investment funds. In laying the ground work for the creation of the business line, we realised the extent of the quality and complementarity of our offerings. The basic principle of the Private Equity Services sector is solidarity between the entities in promoting our products: the three of us are stronger together, and we systematically present our joint offering to clients and prospects. For equity bridge financing, CACEIS and CACIB act as 50/50 partners if CACEIS is the fund’s depositary.

Unlike CACEIS and CACIB, Indosuez Wealth Management’s clients are chiefly high net worth individuals to whom we provide wealth management services. The partner-managers of investment funds are not only clients in a wealth accumulation phase, but high- potential clients as well. What are the benefits for your clients? Stéphane Barret - We now offer our clients a full service offering, with a single team capable of providing them with all the services they need throughout the life of the funds. The synergy with CACEIS has enabled CACIB to establish a closer relationship with investment funds, beginning much earlier in their lifecycle. Our improved knowledge of them enhances our responsiveness; we can respond far more rapidly to client requirements. This responsiveness is highly valued by our clients today.