TPIL Statement of Third Point's New Redemption Policy

Malibu Life Holdings

25/05/2023 16:40

 

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  (#_ftn1) 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  (#_ftn2) 
* 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  (#_ftnref1) 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  (#_ftnref2) 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.



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