Altarius Asset Management (Altarius) and Portcullis Asset Management Limited (Portcullis), both licensed by the Malta Financial Services Authority (MFSA), have formed a strategic alliance to deliver a full suite of evolutionary AIFM services to alternative investment funds regardless of their AUM.
This evolutionary strategic alliance allows early stage managers to seamlessly adopt a full scope AIFM from a “de-minimis”. Many mangers who have experienced their AUM increase faster than expected have found the step from de-minimis to a full-scope AIFM to be disruptive, affect performance, distract from core activities and ultimately slow subscriptions at a critical growth point for the fund.
Altarius and Portcullis strategic alliance will solve this problem and present early stage managers with: cost effective de-minimis-to-full-scope AIFM continuity; seamless transition across middle office operations; significantly reduced disruption and changeover time; and, AIFM familiarity with strategies to be marketed via full-scope passport.
The strategic alliance is the first of its kind in the EU and cements Malta as the pre-eminent EU AIFM jurisdiction – already leading the charge by virtue of its nimble pro-business regulator and highly skilled English-speaking workforce.
Professor Joseph Bannister (pictured), Chairman of the Malta Financial Services Authority, says: “The MFSA is delighted with this initiative. This development is consistent with the innovative approach championed by both the MFSA and the jurisdiction.”
The AIFMD allows for AIFMs to follow a ‘lighter regime’ of AIFMD compliance where aggregate leveraged AUM does not exceed a EUR100 million threshold. One key difference between this ‘de-minimis’ designation and ‘full-scope’ AIFM status is the absence of an obligation on a fund, which is managed by a de- minimis AIFM, to appoint a depository. Additionally, service provider’s fees (including minimum fixed fees) are much lower due to lighter reporting constraints and obligations. Prohibitive early-stage set-up and running costs lead many portfolio managers to opt for a de-minimis AIFM solution as they build track record when starting with modest AUM.
Altarius provides clients with sustainable solutions needed to deal with an increasingly complex corporate and investment regulatory environment.
Within this context Altarius offers clients access to a de-minimis AIFM and a Malta registered umbrella platform housing professional investor sub-funds.
Pierre Maliczack, CEO of Altarius, says: “It has been frustrating to see the numerous talented portfolio managers who, through nothing more than their hard work and strong performance, have been unfairly caught out by the hurried need to appoint a full-scope AIFM as assets have grown – leading to business disruption and loss of focus on portfolio management. That stops today with the Altarius Portcullis offering.”
As a regulated full-scope AIFM, Portcullis assumes responsibility for all AIFMD management functions on behalf of its clients and can accept funds of any size. These functions include marketing specific funds to prospective professional investors using the firm’s AIFMD marketing passport. Under this passport, reporting is centralised through Portcullis’s to the MFSA, instead of to each EU member state regulator.
David Barry, CEO, Portcullis, says: “Following the advent of AIFMD, many portfolio managers quite sensibly opt for a de-minimis AIFM solution in order to build their track record and to keep total expense ratios to a minimum in the early stages – only to discover that they require a full-scope AIFM and marketing passport at short notice as the leverage threshold is reached. The Portcullis team is very pleased to tie up with Altarius in order to solve this problem and we are looking forward to harness our combined strength and depth of industry experience to announce further such initiatives in 2016.
