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CVC Income transitioning investment to new master fund
(Sharecast News) - CVC Income & Growth confirmed in an update on Monday that it would transition its investment into a newly established master fund, as part of a structural overhaul by CVC Credit Partners designed to improve efficiency and broaden investor access across Europe. The London-listed company, which currently operates as a feeder fund into Compartment A of CVC European Credit Opportunities, said it would now exchange its interest into a new Luxembourg-based vehicle, 'CVC Credit Partners Performing Credit SCA SICAV-RAIF - Compartment 1 - European Credit Opportunities Fund', or the 'New RAIF Vehicle'.
It said the switch was expected to be implemented on 31 July.
The firm said the New RAIF Vehicle, structured as a reserved alternative investment fund (RAIF), would have the same investment policy, limits and restrictions as the current vehicle.
It would be managed by CVC Europe Fund Management as AIFM, with CVC Credit Partners acting as delegated investment manager.
There would be no change to management fee rates, and the RAIF would continue not to charge a performance fee.
An additional AIFM fee, expected to be less than 0.02% of gross assets and capped at 0.1%, would apply.
Set-up and operating costs attributable to investors, including CVC Income & Growth, were expected to be immaterial, with total incremental charges not exceeding 0.05% of net asset value.
Following the transition, the New RAIF Vehicle was expected to initially become the majority investor in the existing fund and, over time, the sole investor.
CVC Credit Partners said it expected the RAIF structure would be more attractive to EU-based investors, broadening the capital base and enabling fee reductions as asset thresholds were met.
A five-basis-point cut in the management fee would be triggered if the applicable net asset value grew by just €40m.
The Company said that its investment policy remained substantially unchanged and that the proposal required no action from shareholders.
At 1120 BST, shares in CVC Income & Growth were up 0.27% at 119.82p.
Reporting by Josh White for Sharecast.com.
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