Bespoke Corporate Structure for European Investment Bank

The Client

A “club” type investment arrangement for a Swiss multinational investment bank.

The Challenge

To provide an innovative corporate structure involving Jersey incorporated cell companies, delivering two distinct features for the client’s investment arrangement:

• The ability to either co-invest with others in a single asset; or
• The ability to create their own vehicle, as sole investor, and hold a variety of underlying investments.

Key requirements were the ability for investors to select individual investments and to segregate the liabilities of each investment. Management and control were to be retained by the client and investors were to receive economic rights only.

Solution

IQ-EQ worked closely with lawyers and admin teams to create an innovative structure using an incorporated cell company and a series of incorporated cells. As the underlying private equity and real estate investments were located across Continental Europe, additional holding companies located in the same jurisdiction as each investment were established and held by each incorporated cell. Since each incorporated cell either had a single investor or a single asset, the main characteristics of a fund (being pooling of cash and risk-spreading) did not apply to any of the incorporated cells.

Results

Using a bespoke corporate structure IQ-EQ were able to utilise Jersey’s flexible company law and COBO regime – without the requirement for fund regulation.