25 May 2023
TPIL
Statement on Third Point’s New Redemption
Policy
This
announcement contains inside information.
The Board
of Third Point Investors Limited (“TPIL”
or the “Company”)
wishes to update shareholders on certain amendments to Third Point
LLC’s (“Third
Point” or the
“Investment
Manager”) new
redemption policy for Third Point Offshore, Ltd. (the
“Master
Fund”), the
fund into which TPIL invests.
Current
market conditions have extended the expected timeline for private
companies to list in the public markets. Considering this, Third
Point has announced a change to its redemption policy to address
the illiquidity of Legacy Private Investments[1]
contained
in its portfolio:
-
Beginning
June 30, 2023, redemptions from the
Master Fund will be satisfied with (1) approximately 91% in cash,
and (2) approximately 9% in a participation note
(“Participation
Note”)
representing the redeeming investor’s pro rata share of the Master
Fund’s Legacy Private Investments as of June
30, 2023, and a small cash reserve.[2]
-
It will be
Third Point’s priority to liquidate the Legacy Private Investments
at appropriate levels as opportunities present themselves, and
proceeds from these liquidations will be reinvested in the liquid
portion of the Master Fund.
-
In
connection with the foregoing, holders of the Participation Notes
will be subject to a management fee on the value of those notes at
the same rate applicable to the interests being redeemed, but
reduced by 0.50% per annum. For continuing investors in the Master
Fund, the management fees charged with respect to their ownership
of the Legacy Private Investments will similarly be reduced by
0.50% per annum (with no change to the management fees charged with
respect to the rest of the portfolio). These changes will result in
a small reduction in the current 1.25% management fee associated
with TPIL shares.
In
thinking about its fiduciary responsibility to current, redeeming,
and future investors generally, the Investment Manager believes
this redemption structure offers the most equitable outcome to its
investor base in its entirety. While Master Fund redemptions for
the upcoming quarter-end are within the typical range, Third Point
considers it prudent to enact this policy at the current moment
given the sustained unusual conditions in the macro, rates and IPO
environments.
TPIL-related
redemption requirements, including those associated with the
ongoing share buyback programme and the potential tender offers in
2024 and 2027, will be subject to the new redemption
policy.
However,
in order to satisfy TPIL’s commitments in cash, a slightly higher
redemption of Master Fund shares will be made. When such
redemptions take place, they will result in the accretion of
Participation Notes, which will modestly increase the Company’s
exposure to the Legacy Private Investments in the absence of
liquidity events occurring within the Legacy Private Investments
portfolio.
Rupert Dorey, Chairman of the Board, commented:
“The Board
of TPIL acknowledges the measures and rationale taken by Third
Point for amending the share structure and fee structure at the
Master Fund. The separation of the liquid investments from the more
illiquid private companies portfolio is a prudent measure that will
ensure a more stable platform for investors while enhancing
investor exposure to Third Point’s core strategies and
competencies.
“Importantly,
the new structure will not impact materially on TPIL’s ongoing
share buyback programme or on the proposed share tenders in 2024
and 2027. Assuming flat performance, the exposure to private
companies would expect to increase from around 9% of NAV to 12% in
the event that the 2024 tender was fully subscribed and the current
buyback facility was fully utilised.”
-
Ends -
Press
Enquiries
Third
Point
Elissa
Doyle, Chief Communications Officer and Head of ESG
Engagement
edoyle@thirdpoint.com
Tel: +1
212-715-4907
|
Buchanan
Charles
Ryland
charlesr@buchanan.uk.com
Tel: +44
(0)20 7466 5107
Henry
Wilson
henryw@buchanan.uk.com
Tel: +44
(0)20 7466 5111
|
Notes
to Editors
About
Third Point Investors Limited
www.thirdpointlimited.com
Third
Point Investors Limited (LSE: TPOU) was listed on the London Stock
Exchange in 2007 and is a feeder fund that invests in the Third
Point Offshore Fund (the Master Fund), offering investors a unique
opportunity to gain direct exposure to founder Daniel S. Loeb’s
investment strategy. The Master Fund employs an event-driven,
opportunistic strategy to invest globally across the capital
structure and in diversified asset classes to optimize risk-reward
through a market cycle. TPIL’s portfolio is 100% aligned with the
Master Fund, which is Third Point’s largest investment strategy.
TPIL’s assets under management are currently $600 million.
About
Third Point LLC
Third
Point LLC is an institutional investment manager that actively
engages with companies across their lifecycle, using dynamic asset
allocation and an ethos of continuous learning to drive long-term
shareholder return. Led by Daniel S.
Loeb since its inception in 1995, the Firm has a 37-person
investment team, a robust quantitative data and analytics team, and
a deep, tenured business team. Third Point manages approximately
$12.2 billion in assets for sovereign
wealth funds, endowments, foundations, corporate & public
pensions, high-net-worth individuals, and employees.
[1] Legacy
Private Investments is defined as Private Investments (investments
made by the Master Fund that are traditionally considered venture
capital or private equity) other than those with ongoing capital
contributions.
[2] The cash
reserve will be used for fees and expenses, including management
fees, costs related to currency hedging in respect of certain
Legacy Private Investments and other applicable Fund operating
expenses.