Thu, Apr 2, 2020
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: ILPA model limited partnership agreement focuses on favorable terms for LPs

Friday, November 22, 2019

By: Kate Binedell, Christine Ormond Bryan Cave Leighton Paisner

ILPA has recently published a model limited partnership agreement (LPA) that reflects preferred terms and practices for the LP community investing in private equity funds. The Model LPA conforms to ILPA Principles 3.0 (published earlier this year), and is part of ILPA's Simplification Initiative, designed to streamline the negotiation process and reduce fund formation costs. Time will tell as to whether or not the Model LPA is likely to emerge as the manager roadmap to attract LP capital and establish best practices, or instead becomes a useful benchmarking/reference point of investor representations in private funds. In either case, the industry should carefully consider the pro forma, alongside Principles 3.0, and be prepared for a healthy dialogue between investors and promoters during the fundraise and over the life of the fund.

We have provided a sample of those ILPA Model LPA provisions that we believe will be of interest to fund managers, sponsors and investors, along with our comments.

1. GP and fund economics

The Model LPA features a whole fund carried interest calculation (ie the European standard all-contributions-plus-preferred-return-back-first model) with illustrative typical market terms for a large closed-ended value added or opportunistic fund - being a management fee (unspecified in the Model LPA, but typically 1-2%), 20% carry, 8% hurdle and 80:20 GP catch-up arrangement. ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Investing: Ray Dalio's Bridgewater scales down European short bets after $3.2bn windfall, Here's what top hedge funds are buying in the coronavirus stock market crash[more]

    Ray Dalio's Bridgewater scales down European short bets after $3.2bn windfall From Financial News: Bridgewater Associates, the world's biggest hedge fund, has retreated from shorting European stocks after making an estimated €2.9bn ($3.2bn), as its founder and co-chairman Ray Dalio c

  2. Bill Ackman writes letter to shareholders on coronavirus[more]

    Pershing Square Holdings (PSH)'s Bill Ackman wrote a letter to investors outlining his insight on the coronavirus pandemic in the United States. He revealed that PSH completed the process of exiting the hedges on 23 March, netting a gross $2.1bn for PSH, after turning 'increasingly positive on equit

  3. New Launches: LGPS Central sets up investment grade bond fund, Leeds Equity Advisors aims to raise $1bn for PE fund, RLI Investors to launch European last-mile logistics fund, DBL Partners IV targets $450m[more]

    LGPS Central sets up investment grade bond fund From IPE: LGPS Central, the asset pooling vehicle for eight local government pension schemes (LGPS) based in England's Midlands, has launched a global investment grade corporate bond fund in order to meet its partner funds' needs. The po

  4. Investing: Marathon sees cheap assets amid dislocation in credit, Deerfield's health care buying spree, It's time to buy shares again, says BlackRock, Credit Suisse, Fed is buying credit ETFs but one hedge fund is shorting them[more]

    Marathon sees cheap assets amid dislocation in credit From Bloomberg: Distressed-investment specialist Marathon Asset Management is buying beaten-up debt amid the greatest dislocation in credit markets since 2008, according to Bruce Richards, co-founder and chief investment officer of the

  5. People: Carlyle picks 2 deputy heads for Japan buyout advisory team, Ex-Kleinwort Hambros adviser takes senior role at multi-family office boutique[more]

    Carlyle picks 2 deputy heads for Japan buyout advisory team From PIonline.com: Takaomi Tomioka and Hiroyuki Otsuka were named deputy heads of the Japan buyout advisory team at Carlyle Group. The positions are new, confirmed a spokeswoman for the New York-based private markets investment g