Macfarlanes Guides Carne Group and WTW in Landmark FCA Fund Approval
The launch of the Long-Term Asset Fund (LTAF) in the UK marks a pivotal moment for pension savers, offering unprecedented access to private equity investments. On October 15, 2024, Macfarlanes, a prominent London-based law firm, announced its key role in advising Carne Group and WTW (Willis Towers Watson) in securing regulatory approval from the Financial Conduct Authority (FCA) for this groundbreaking fund.
Pioneering Private Equity Access
The CG WTW Private Equity Access LTAF (CG WTW PEAL), initially unveiled in April 2024, aims to bridge the gap for professional and institutional investors eager to delve into private equity. This innovative fund is designed to cater to the long-term investment needs of a variety of end investors, including defined contribution (DC) pension savers who have traditionally faced hurdles in accessing these types of investments.
The Macfarlanes team, spearheaded by investment management partner Lara Froud, worked closely with senior associates Emma Garnham, Tiffany Cox, Sandeesh Shaha, and associates Harry Middleton and Angela Phelan. Froud commented on the firm’s involvement: “Having played a significant role in shaping the LTAF framework, Macfarlanes is delighted to have served as legal counsel to WTW and Carne on this pivotal fund launch. We believe that access to private equity will enhance returns and diversification for members while mitigating portfolio volatility.”
A Strong Start with Client Interest
The fund has already garnered significant attention, attracting USD 850 million in client interest across Europe. Ben Leach, who leads WTW’s private market solutions, expressed pride in the successful launch, stating, “This is a significant achievement for WTW, and we are eager to see how it benefits end savers aiming to enhance their wealth through investments in this asset class.”
Private equity investments have long been celebrated for their potential to deliver robust returns. Known for their illiquidity and skill premia, these investments are increasingly seen as essential for maximizing long-term returns in private markets. The CG WTW PEAL will provide a platform for both DC and private investors to capitalize on these opportunities.
Meeting Long-Term Investment Needs
This fund launch aligns with a broader industry initiative aimed at addressing the long-term investment needs of various end investors, including DC pension savers. By providing these traditionally underserved investors with access to private equity assets, WTW aims to empower savers to enhance their wealth over time.
WTW’s LifeSight, a master trust for DC pensions boasting over 360,000 members, has already committed to allocating up to 5% of its LifeSight Equity default fund to private equity investments. This strategic move underscores the firm’s commitment to introducing more long-term solutions for savers across Europe and the Asia-Pacific region.
Innovative Partnerships
Mark Stockley, Chief Business Development Officer at Carne Group, remarked on the collaboration between Carne and WTW, stating, “The partnership for launching the LTAF marks a major step in making private equity accessible to UK pension savers. We are thrilled to continue being the preferred partner for launching these innovative products.”
The joint effort between Carne Group and WTW reflects a significant shift in the investment landscape, as industry players work collaboratively to create products that meet the evolving needs of investors. With private equity gaining traction, these organizations are poised to play a crucial role in shaping the future of investment strategies for pension savers.
Conclusion
As the UK fund sector continues to evolve, the successful launch of the CG WTW Private Equity Access LTAF represents a notable advancement, driven by the strategic guidance of Macfarlanes. This initiative not only enhances the investment landscape for pension savers but also sets a precedent for future collaborations in the financial services industry. By providing access to private equity, these organizations are helping investors unlock the potential for significant long-term growth.