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Partnership terms and conditions 2002-2003

The management fees charged by private equity firms have changed very little over the last year despite a significant deterioration in fundraising conditions, according to a new report carried out by SCM Strategic Capital Management. The findings suggest that hopes a tougher market would result in a big swing in the balance of power in favour of investors have been disappointed.

The report also raises concerns over the difficulties experienced by investors if they attempt to enforce their right to terminate funds for cause and on a no-fault divorce basis. The research finds that managers are often still reluctant to part with fee income and carried interest even if termination has been due to cause.

Click here to view full report (pdf 320kb)

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Based in Switzerland, Strategic Capital Management is a gatekeeper for some of the major Swiss insurance companies and public and private pension funds. It manages CHF2bn in its private equity programmes and has around CHF100m in discretionary accounts for smaller Swiss investors. It invests across the private equity spectrum both in terms of stage and geography. The firm was set up in 1996 by Hepp and Benedikt Schurch, who had worked together at Morgan Stanley as head of Swiss institutional business and head of asset management respectively.