Representative Engagements - Private Capital Advisory
Conway MacKenzie is currently providing tail end fund advisory services to the stakeholders of a middle market private equity fund. The fund is approaching the expiry of its contractual term, and the GP has requested a 3-year extension and continuation of management fees. Adding complexity to the situation is the existence of fund level leverage in the form of high yield notes.
Our RoleOur role broadly consists of the following:
- The performance of focused due diligence with respect to the fund’s investment portfolio; and
- An assessment of strategic alternatives available to the fund’s stakeholders;
- Assistance with the identification, evaluation and execution of various financial restructuring, performance improvement and other strategic initiatives to enhance the value of the fund’s investment portfolio.
Conway MacKenzie was engaged by one of the largest municipalities in the United States with respect to certain of its pension fund investments that were managed by a general partner that disbanded, leaving the underlying investments at risk. The related investment funds had approximately $115 million of assets under management that Conway MacKenzie was responsible for investigating.
Our role centered on assisting the municipality and a newly selected replacement general partner with (i) conducting forensic analysis to assess the extent to which funds were utilized in conformity with the underlying partnership agreements, (ii) conducting an assessment of potential claims against the general partner, and (iii) assisting the replacement general partner in the transition of the fund from the former general partner.
In addition, we performed a detailed assessment surrounding other key provisions of the funds’ partnership agreements to determine whether those provisions were adhered to by the former general partner.
The ResultConway MacKenzie provided transparency into the historical operations of the funds and assisted in the recovery of approximately $6 million of assets for the benefit of the partnership’s investors, as well as the identification of other potential claims.
A member of the Conway MacKenzie’s Private Fund Services practice worked with a $4 billion+ publicly traded credit institution that was operating under a cease and desist order from the Office of Thrift Supervision. As a result of the financial crisis and underperformance by the bank, the bank became focused on stabilization of capital ratios, raising capital and instituting controls and processes to track, report and manage the classified loan portfolio.
Our RoleAs part of the restructuring, the Conway MacKenzie professional was responsible for:
- Strategic evaluation of the bank’s loan portfolio including projecting charge offs and FAS 114 reserves and their impact on capital ratios with a focus on the classified loan portfolio;
- Performing stress testing of the loan portfolio based on different interest rate scenarios;
- Analyzing and making recommendations on bids for its classified loan portfolios being marketed for sale, including evaluation of expected future loan values and marks and evaluating bids received on the portfolio;
- Developing the mechanism to streamline the bank’s credit and risk department including revamping classified asset tracking & reporting;
- Liaising with potential investors to evaluate the loan portfolio across all segments for potential sale as well as bank recapitulation.