Opalesque Industry Update - CQS today announces its intention to establish CQS Diversified Fund Limited (“CQS Diversified” or
the “Company”). It is intended that the Company, once established, will seek admission to trading
of its ordinary shares (“Shares”) on the Main Market of the London Stock Exchange plc through a
proposed placing to institutional investors in the UK and elsewhere and offer for subscription to the
public in the United Kingdom. |
Multi-Fund – the Company will invest substantially all of its assets into CQS Diversified Fund (SPC) Limited, Segregated Portfolio Alpha (“DVA”), an existing dynamically managed fund of CQS managed funds launched in March 2007
Convertible and Credit focus – DVA provides exposure to a range of CQS-managed hedge funds; currently invested in 5 convertible and/or credit-focused strategies
DVA performance – net returns over last 12 months of 15.67%1 and annualised net return since inception of 10.18%
Market opportunity – CQS believes that there is an excellent current opportunity set in specialist convertible and credit strategies; volatility in credit and equity markets and ongoing dispersion of credits are creating attractive idiosyncratic opportunities
No additional layer of fees – no management or performance fees to be charged at the Company or DVA level
Immediate investment – full investment into DVA on the first monthly dealing day following admission
Discount control – continuation vote if shares trade at an average annual discount of 5% or more for any rolling 12 month period; separate authority to buy back up to 14.99% of issued shares
Share class – single class of GBP denominated shares; issue price of £1.00
Listing costs – to be capped by CQS at 1% of gross IPO proceeds at launch; opening NAV of £0.99.
Rebate arrangements – available for large subscriptions
CQS participation – CQS intends to participate in the IPO with anticipated future participation thereafter
Wholly independent board of directors – no CQS representation on the Board
Michael Hintze, CEO and Senior Investment Officer of CQS, commented:
The Company’s proposed listing on the London Stock Exchange will provide investors with access to a differentiated convertible and credit-focused investment company which invests in a range of CQS-managed hedge funds. We believe a multi-fund approach is well suited for this type of investment and should complement the existing choice that investors have in the listed funds sector.
We believe our fundamentally-driven investment process positions us well to continue to take advantage of opportunities in credit and equity markets.”
The Company will have a wholly independent board of directors with extensive and relevant investment experience.