At a glance
- The distributing cut is a floor and the compounding cut a ceiling.
- The presentation, dated this month and reported by WealthManagement.com, ties the fee reductions to existing money and to conversion.
- Announced earlier this month, the restructuring would turn Global Value into an "umbrella" structure holding two portfolios: a distributing fund with older, lower-performing assets and a compounding entity the firm says offers potentially higher returns over time.
Partners Group Holding AG is cutting management fees on both portfolios of its €6.6 billion ($7.4 billion) Global Value SICAV as it seeks investor approval to restructure the evergreen fund, with a vote due next month.
Investors in the distributing fund will pay at least 25 basis points less for three years, while holders in the compounding fund get up to 75 basis points off management fees through January 1, 2030, according to an investor presentation seen by Bloomberg. The distributing cut is a floor and the compounding cut a ceiling.
The presentation, dated this month and reported by WealthManagement.com, ties the fee reductions to existing money and to conversion. "Existing investors will benefit from reduced management fees in the distributing fund and, upon conversion, on their converted holdings in the compounding fund," Partners Group said in the document. Newly invested capital also gets the lower fee in the compounding fund.
Announced earlier this month, the restructuring would turn Global Value into an "umbrella" structure holding two portfolios: a distributing fund with older, lower-performing assets and a compounding entity the firm says offers potentially higher returns over time. The same report also says Partners Group is reducing investors' ability to withdraw cash from the fund, lowering the redemption threshold for some investors.
The firm has limited withdrawals from Global Value and some other funds, and its shares have fallen almost 40% this year, according to the report. Partners Group reported 905 million Swiss francs ($1.1 billion) of first-half management income, up 6%, in September.
For a client holding $100,000 in the distributing sleeve, 25 basis points is $250 a year, or $750 over the three-year window. In the compounding sleeve, the maximum 75 basis-point cut equals $750 a year on the same amount. Mara Dobrescu, a senior principal quoted in the Bloomberg report, called the cut "an improvement, though fees here start from a high base."
Reported by the Products & portfolios desk from WealthManagement.com and Bloomberg (investor presentation, as reported by WealthManagement.com). Published . Corrections