11 Sep 2014

Alpha Strategic announces partnership with Premium Point Investments

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Capital provider to successful asset management firms

ALPHA STRATEGIC

Flexible investment structures

Permanent capital

Engaged and confidential relationship

© 2015 ALPHA STRATEGIC All rights reserved. Use of this website is governed by the Conditions of Use.

Alpha provides long-term capital solutions to address:

Illustrative Examples

Example A - Founder Retirement
Ownership
Founder A 30%
Founder B 30%
Founder C 30%
Employees 10%
Transaction
Founder A equity converted to RSI
Retirement Amount $72
RSI is purchased by Alpha
Alpha Investment $72
Alpha RSI 15%
Post Transaction
Remaining equity holders accrete in proportion
Founder B 43%
Founder C 43%
Employees 14%
Proceeds paid to retiring Founder
Founder A Proceeds $72
Pro-Forma Financials
AuM (BN) $2.0
Revenues $68
EBITDA $28
Example B - Buy-back and Liquidity
Ownership
Seed Investor 26%
Founder A 32%
Founder B 32%
Employees 10%
Transaction
Company issues RSI for liquidity purposes
Seeder Buy-Back Amount $50
Founder Liquidity $22
RSI is purchased by Alpha
Alpha Investment $72
Alpha RSI 15%
Post Transaction
Employees accrete relatively more equity
Founder A 43%
Founder B 43%
Employees 14%
Founder proceeds invested in the fund
Seeder Proceeds $50
Founder Fund Investment $22
Pro-Forma Financials
AuM (BN) $2.0
Revenues $68
EBITDA $28
Example C - $500M Fund Launch
Ownership
Founder A 30%
Founder B 30%
Founder C 30%
Employees 10%
Transaction
Company issues RSI for capital purposes
New Fund Commitment $72
Total Fundraise Target $500
RSI is purchased by Alpha
Alpha Investment $72
Alpha RSI 15%
Post Transaction
No impact on equity holdings
Founder A 30%
Founder B 30%
Founder C 30%
Employees 10%
Proceeds invested in the new fund
Fund Investment $72
Pro-Forma Financials
AuM (BN) $2.5
Revenues $83
EBITDA $43

The examples above are for illustration purposes only and do not necessarily represent exact capital investments made by Alpha Strategic.

The illustrative examples above use the following assumptions:

Financial Assumptions
AuM (BN)Revenues (MN)EBITDA (MN)
$2.0$80$40

Alpha has an attractive financing approach:

Alpha offers an engaged & confidential relationship:

Successful, privately owned asset managers often require capital to facilitate strategic initiatives at key stages of their development but do not want the constraints of a debt commitment or the day-to-day oversight that a majority shareholder might require.

Alpha Strategic provides passive minority capital to high quality asset management firms in either revenue share or structured equity form, enabling them to recapitalise their business whilst preserving their independence, culture and management autonomy.

Asset management firms use Alpha’s long-term capital to: recycle equity for the next generation; fund a liquidity event for a retiring partner or seed investor; or raise expansion capital to fund a new product launch, team lift out or acquisition. Alpha's target investment size is $50 - $100 million.

We are a privately owned investment platform with long-term committed capital from a single source. Alpha has a focused investment strategy and offers partner firms an engaged and confidential relationship.

History

2005

Established

2006

Investment in
Winton Capital Management

2009

Investment in
IKOS Asset Management

2011

Investment by
Northill Capital

2012

New management team

2013

Minority shareholder
buy-out by Northill Capital

2014

Investment in
Premium Point Investments

Alpha Strategic was established in 2005 as an AIM-listed UK company to be a buy and hold investor in a portfolio of minority stakes in the operating revenues of a diversified group of privately owned asset managers.

In 2006 Alpha acquired a minority investment in funds managed by Winton Capital Management Limited.

In 2009 Alpha acquired a minority investment in funds managed by IKOS Asset Management Limited. Alpha exited this investment at the end of 2012.

In 2011 Alpha strengthened its capital base via a share placing with Northill Capital, an independent asset management business founded in 2010 with substantial financial backing from interests associated with the Bertarelli Family. Northill’s shareholding in Alpha was increased in 2013 as part of a buy-out of the minority shareholders and subsequent delisting of Alpha from AIM.

At the end of 2012 Alpha appointed a new management team, under the leadership of Alistair McKay, with extensive networks in the asset management industry, considerable experience in sourcing and structuring minority investments and the expertise to be an engaged and supportive business partner.

In 2014 Alpha announced a strategic partnership and minority investment in Premium Point Investments LP, a US-based institutional asset manager focused on residential mortgage markets.

Team

Alistair McKay

Chief Executive

Alistair McKay Chief Executive

Alistair McKay has over 24 years’ experience in the financial services industry. Prior to being appointed CEO of Alpha Strategic, he was a Managing Director in the Investment Banking departments of Morgan Stanley and Credit Suisse where he ran the Investment Management Advisory Groups and led many high profile M&A, IPO and PCV assignments both for clients in Europe and the US. In 2009 he joined the senior management team of Asset Management Finance, a Credit Suisse subsidiary and one of the leading buyers of minority stakes in fund management businesses. Alistair joined Alpha at the end of 2012 with the aim of building out Alpha’s unique proposition into a leading minority investor and a long-term business partner to medium-sized fund management businesses globally. Alistair started his investment banking career in the Financial Institutions Group of Kleinwort Benson plc. He is a qualified Chartered Accountant and holds a Bachelor of Science degree.

Antoine Dupont-Madinier

Executive Director

Antoine Dupont-Madinier Executive Director

Antoine Dupont-Madinier has over 14 years’ experience in the financial services industry. Prior to joining Alpha Strategic, he has held senior positions in the Financial Institutions Group at both Credit Suisse and Morgan Stanley with a particular focus on the traditional and alternative asset management and asset servicing sectors. During his investment banking career, Antoine has been involved in many significant M&A, IPO and capital raising transactions in the financial services industry and in particular in the fund management sector where he advised extensively on large divestitures and consolidation transactions in the long-only industry, minority stake sales, IPOs and listed fund offerings in the hedge fund and private equity industry. Before joining Alpha, Antoine worked in a corporate & business development role at Renshaw Bay, a UK asset management firm. Antoine started his career at Fox-Pitt, Kelton where he advised banks and insurance companies on corporate finance matters. He holds a MSc in Management from EM Lyon (France).

Oliver Heaton

Vice President

Oliver Heaton Vice President

Oliver Heaton has over 10 years' experience in the fund management industry. He has worked on and led the buy and sell-side for numerous acquisition and business development strategies involving traditional and alternative fund managers. As part of the investment team, Oliver’s responsibilities at Alpha Strategic include investment origination, due diligence and deal structuring, whilst leveraging Alpha's existing partnership opportunities. Prior to joining Alpha, Oliver was a Director of Dumas Capital. From 2004, Oliver supported Dumas in its capacity as a regulated independent consulting and advisory company, acting as a portfolio manager to the Retro Classics Fund and undertaking private capital raisings for established fund managers including GLC and Alternative Asset Managers. Oliver holds a BA from Trinity College Dublin and the Chartered Alternative Investment Analyst (CAIA) designation.

Nicola Howe

Reporting & Operations

Nicola Howe Reporting & Operations

Nicola Howe has 30 years’ experience within the financial services sector. She started her career in cash settlements, progressing to trading spot foreign exchange before moving on to being responsible for developing, managing and co-ordinating the funding of cash requirements within the global Treasury divisions of both retail and investment banks. Nicola joined Alpha Strategic in 2009 and manages the operation and administrative requisites of the Company.

Rajal Bodhania

Executive Assistant

Approach

Alpha typically acquires an interest equivalent to between 10% and 25% of a firm’s enterprise value and believes that economic alignment and management freedom is best achieved through a revenue share structure. Alpha recognises that partner firms may over the long run grow to be very successful businesses and is prepared to structure additional incentive arrangements to compensate for above-plan economic outcomes.

Alpha seeks to partner with firms where the majority of the equity ownership is held by the management team. We have a bias for alternative asset managers with a focus on a single asset class or investment style. Although we also consider long-only businesses we do not invest in distribution-led firms, in wealth management businesses, in fund-of-fund businesses or in passive management firms.

Alpha believes that asset management firms of a certain size are more relevant to institutional clients and are more likely to grow steadily and attract a diversified investor base. We also believe that asset management firms at the appropriate size level can accommodate a minority capital partner and have the financial strength to withstand a market downturn. Whilst there is no upper limit to the size of a potential partner firm, we prefer investing in firms with assets under management of between $1BN and $10BN.

Alpha invests in asset management firms with extensive investment experience, with a repeatable and recognised investment process, with a long-term track record and a strong risk management framework.

Alpha recognises the importance of culture in successful asset management firms. We seek to partner with firms with a collegial and collaborative style, where tenure of employment and client relationships are valued highly and where risk management and regulatory compliance are recognised as critically important operational success factors.

Alpha is building a portfolio of a small number of minority interests in established asset management firms diversified by investment strategy and geography. We believe that a disciplined and focused approach results in more meaningful and successful relationships.

Value Added

Alpha offers the following benefits:

The senior executives of Alpha and Northill have collectively over 150 years of industry experience across senior executive roles in investment banking advisory, global consulting functions, product development and global sales and distribution management.

Alpha is affiliated with Northill Distribution US Inc. (‘NDUS’), a US broker-dealer. NDUS is a dedicated distribution business established to support the Northill group of companies and Alpha’s portfolio firms. NDUS is based in New York and is a FINRA registered securities broker-dealer and a member of SIPC.

Alpha’s management team can provide portfolio firms with guidance on the design, timing and feasibility of new product launch initiatives. Northill has established fund platforms in Ireland and the Cayman Islands which can offer Alpha’s portfolio firms umbrella product solutions in Qualifying Investor Alternative Investment Funds (‘QIAIF’) and Segregated Portfolio Companies (‘SPC’) respectively.

Alpha has the insight and experience to provide perspectives on competitor positioning, client and asset flows, product fee developments, best practise guidance on operational infrastructure and compensation policies.

Partner Firms

Premium Point Investments LP (‘Premium Point’) is an institutional asset manager that engages in relative value trading and fundamental credit investing in the residential mortgage markets. Premium Point manages a hedge fund, operates a mortgage conduit business and owns a majority interest in a residential property manager. Premium Point's residential platform is vertically integrated across real estate acquisition, property management, loan underwriting, bond securitization and securities trading. Anilesh Ahuja founded Premium Point in 2008.

www.premiumpt.com

Winton Capital Management Limited (‘Winton’) is a global investment management business that employs a large research team to perform scientific analysis on historic data related to financial markets in an attempt to identify profitable investment opportunities. David Harding founded Winton in 1997.

www.wintoncapital.com

Northill Capital

Northill Capital is an independent, privately held asset management business founded at the end of 2010 with substantial financial backing from interests associated with the Bertarelli Family. Northill’s long-term strategy is to build a portfolio of high quality specialist asset management businesses. Combined assets under management in which Northill owns a majority interest total $31.8 billion.* Northill brings deep industry experience and expertise and the patient, long-term application of substantial private capital to support skilled investment professionals in the development of their business.

* As at 31 March 2015

www.northill.com

Alpha Strategic plc
15-17 Grosvenor Gardens
London SW1W 0BD

info@alphstrategic.com
+44 (0) 20 7222 3005

Conditions of Use and Cookie Policy

Conditions of Use

Access to this website and the use of the information which appears on it (the ‘Contents') are governed by the following terms and conditions. These terms and conditions are important and they may affect your rights. Please take time to read them carefully each time you visit this website.

Reference in these terms to 'we', 'our' or 'us' is to Alpha Strategic plc (‘Alpha Strategic’).

The Contents are published solely for the purpose of providing general information about Alpha Strategic. The Contents are published by Alpha Strategic in good faith and have been taken from sources believed to be reliable. We have not verified all of the Contents. We do not represent that the Contents are accurate, complete or fair and they should not be relied on as such. We do not accept any liability for loss or damage whatsoever including loss of profit (whether direct, indirect or consequential) in respect of the use of this website or its content and we are not responsible for any interruptions or delays in service which may occur. The Contents, any opinions and estimates expressed therein are subject to change by us without notice.

This website is not intended to be used as a tool for providing investment advice on the merits or suitability of products and no information contained within this website should be construed as such. This website provides information about Alpha Strategic and does not provide advice to clients. Please seek your own legal, investment and tax advice as you deem appropriate. This website is for information only. It should not be construed as a solicitation or an offer to buy or sell any securities or related financial instruments.

Certain (hypertext) links on this website will lead to other websites which are not under our control. When you activate any of these you will leave the Alpha Strategic website and we give no endorsement nor accept responsibility or liability in respect of the content of such websites or any products or services offered through such websites.

We make no representation that this website is free from infection by viruses or anything else that has contaminating or destructive properties.

This website is established in England and these terms shall be governed and construed in accordance with English Law. When you use the website you accept that your use thereof shall be governed by the laws of England and if any dispute arises as to your use of this website, you agree to allow such dispute to be heard in the English courts. If any provisions of these terms shall be unlawful, void or for any reason unenforceable then that provision shall be deemed severable and shall not affect the validity and enforceability of the remaining provisions.

The Contents is © Alpha Strategic. Please note that all images and information contained on this website may be copyright works. The copyright and all other rights in all of the material on this website are owned by Alpha Strategic. Except for the making of a hard copy print for your own personal use only or the use of others in your organisation (or downloading the material for personal use or the use of others in your organisation only provided that you retain all copyright and proprietary notices), the material on this website may not be copied, reproduced, transmitted, distributed or displayed, by any means, without the express prior written consent of Alpha Strategic.

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Conditions of Use

Access to this website and the use of the information which appears on it (the ‘Contents') are governed by the following terms and conditions. These terms and conditions are important and they may affect your rights. Please take time to read them carefully each time you visit this website.

Reference in these terms to 'we', 'our' or 'us' is to Alpha Strategic plc (‘Alpha Strategic’).

The Contents are published solely for the purpose of providing general information about Alpha Strategic. The Contents are published by Alpha Strategic in good faith and have been taken from sources believed to be reliable. We have not verified all of the Contents. We do not represent that the Contents are accurate, complete or fair and they should not be relied on as such. We do not accept any liability for loss or damage whatsoever including loss of profit (whether direct, indirect or consequential) in respect of the use of this website or its content and we are not responsible for any interruptions or delays in service which may occur. The Contents, any opinions and estimates expressed therein are subject to change by us without notice.

This website is not intended to be used as a tool for providing investment advice on the merits or suitability of products and no information contained within this website should be construed as such. This website provides information about Alpha Strategic and does not provide advice to clients. Please seek your own legal, investment and tax advice as you deem appropriate. This website is for information only. It should not be construed as a solicitation or an offer to buy or sell any securities or related financial instruments.

Certain (hypertext) links on this website will lead to other websites which are not under our control. When you activate any of these you will leave the Alpha Strategic website and we give no endorsement nor accept responsibility or liability in respect of the content of such websites or any products or services offered through such websites.

We make no representation that this website is free from infection by viruses or anything else that has contaminating or destructive properties.

This website is established in England and these terms shall be governed and construed in accordance with English Law. When you use the website you accept that your use thereof shall be governed by the laws of England and if any dispute arises as to your use of this website, you agree to allow such dispute to be heard in the English courts. If any provisions of these terms shall be unlawful, void or for any reason unenforceable then that provision shall be deemed severable and shall not affect the validity and enforceability of the remaining provisions.

The Contents is © Alpha Strategic. Please note that all images and information contained on this website may be copyright works. The copyright and all other rights in all of the material on this website are owned by Alpha Strategic. Except for the making of a hard copy print for your own personal use only or the use of others in your organisation (or downloading the material for personal use or the use of others in your organisation only provided that you retain all copyright and proprietary notices), the material on this website may not be copied, reproduced, transmitted, distributed or displayed, by any means, without the express prior written consent of Alpha Strategic.

IP Addresses and Cookie Policy

IP Addresses and Cookies: We may collect information about your computer, including where available your IP address, operating system and browser type, for system administration and to monitor acceptance of our disclaimers. This is statistical data about our users’ browsing actions and patterns, and does not identify any individual. For the same reason, we may obtain information about your general internet usage by using a cookie file which is stored on the hard drive of your computer. Cookies contain information that is transferred to your computer’s hard drive. They help us to improve our site and to deliver a better and more personalised service. They enable us:

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  • To speed up your searches.
  • To recognise you when you return to our site.

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