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Offer to purchase units in side-pocketed funds

Date : 07/08/2024

Location : Paris / London

H2O AM LLP and the FCA reach a settlement allowing a definitive exit from side-pocketed funds for all unitholders

The H2O AM Group is offering an accelerated and definitive exit for unitholders of the side-pocketed funds. In addition to the €229 million already repaid, the company has secured €250 million which will be paid to all unitholders. As a result, unitholders who sold their units on 14 October 2020 when the funds reopened will recover between 87% and 93% of the value of their total investment at the time of suspension on 28 August 2020, depending on the fund. The unitholders accepting the offer will receive an enhanced and earlier payment by selling their side-pocketed funds. In addition, any sums arising from the sale of assets which remain held by these funds or that may be recovered from fines already paid will be returned to them.

H2O AM LLP, the Group’s UK entity, has reached a settlement with the Financial Conduct Authority (FCA). As part of this settlement, a Final Notice has been published today which covers events between 2015 and 2019 relating to investments in entities linked to Tennor Holding BV. In this Notice, the FCA highlights that the offer to be made to unitholders in the side-pocketed funds is based on voluntary and significant contributions, without admission of liability, on the part of H2O AM Group and its shareholders and that H2O AM Group has made significant changes to its governance, systems and controls since that period. H2O AM LLP is no longer subject to an FCA investigation.

The H2O AM Group has secured €250 million in order to finance an offer (the “Offer”) to all unitholders of the side-pocketed funds in an equal manner, allowing them the opportunity to accept the Offer by selling their units to H2O AM LLP. Unitholders accepting the Offer will receive an enhanced and earlier payment compared to non-participating unitholders, starting in the fourth quarter of 2024, and will relinquish their rights to bring claims against H2O AM Group and any third party in connection with these investments relating to Tennor Holding BV entities, and their management. In addition, any additional proceeds from the liquidation of assets held by the side-pocketed funds or from fines recovered will be redistributed to all unitholders, including those who have accepted the Offer, which is expected to open early September 2024. In the coming weeks, the H2O AM Group will communicate further details on the terms and conditions of the Offer. These have been shared with the FCA and the Autorité des marchés financiers (AMF) and will be presented through various channels, including a dedicated website. The Offer has been prepared with the assistance of Eric Pinon’s consulting firm.

This €250 million Offer will enable an accelerated and definitive exit from the side-pocketed funds and will be in addition to the €229 million already repaid. Thus, by accepting the Offer, unitholders who held €100 on 28 August 2020, the day of the suspension, having:

    • sold their open-ended funds (FCP) when they reopened on 14 October 2020, will recover 87% to 93% of the value of their investment, depending on the fund (see table 1);

    • maintained their investment in the FCPs until 31 December 2023, have recovered their entire investment thanks to performances well in excess of each FCP’s objective (see table 2).

Furthermore, over the past few years, H2O AM has consolidated its corporate governance, notably by establishing Supervisory Boards with a two-thirds majority of independent members. These measures are complemented by the strengthening of its internal control procedures, in order to ensure compliance with the highest standards. Finally, adapting to the consequences of Brexit, H2O AM Group has gradually transferred its portfolio management team to continental Europe. In line with this move, H2O AM LLP will voluntarily apply to cancel its UK permissions by end of 2024.

Loïc Guilloux, CEO of H2O AM Group, notes: « With this settlement, we acknowledge the FCA’s findings relating to investments in private securities undertaken by H2O AM LLP between 2015 and 2019 and take a major step forward. Over the last few years, we have significantly improved and consolidated our organisation and strengthened our risk management and compliance teams, governance and internal procedures. These changes ensure that lessons from this period are embedded in our corporate culture. Today, this settlement enables us to provide a concrete and swift solution to all our unitholders and to look to the future, whilst remaining focused on our clients’ interests and meeting their needs. Our
strengthened governance, resilience and passion for performance will continue to guide us in the years ahead. »

Table 1: for €100 held on 28 August 2020, the day of the suspension, and a redemption of the open-ended funds (FCP) when they reopened on 14 October 2020.

*including acceptance of the Offer and the two reimbursements of the side-pocketed funds, without assuming any further reimbursement nor any funds recovered from fines already paid.

Table 2: for €100 held on 28 August 2020, the day of suspension, and open-ended funds (FCP) held until 31 December 2023.

*including acceptance of the Offer and the two reimbursements of the side-pocketed funds, without assuming any further reimbursement nor any funds recovered from fines already paid.

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H2O AM : Explanatory video for subscribing to the Offer



 

H2O AM : Video esplicativo per l’adesione all’Offerta

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The Funds listed on this website are not authorised or recognised by the Monetary Authority of Singapore (the “MAS”) and the Units are not allowed to be offered to the retail public.
Information Memorandums and any other document or material issued in connection with the offer or sale is not a prospectus as defined in the SFA and accordingly, statutory liability under the SFA in relation to the content of prospectuses does not apply, and you should consider carefully whether the investment is suitable for you.
Information Memorandums have not been registered as a prospectus with the MAS. Accordingly, Information Memorandums and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of Units may not be circulated or distributed, nor may Units be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than:
(i) to an institutional investor (as defined in the SFA) under Section 304 of the SFA;
(ii) to an accredited investor (as defined in the SFA) under Section 305 of the SFA, or any person pursuant to Section 305(2), where such person is not an individual, and in accordance with the conditions specified in Section 305 of the SFA, and where applicable, the conditions specified in Regulation 3 of the Securities and Futures (Classes of Investors) Regulations 2018; or
(iii) to an institutional investor or accredited investor, otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
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H2O Asset Management L.L.P.

H2O Asset Management L.L.P. is registered in England and Wales with a share capital of 10,000,000 £, with registered name H2O AM LLP, registration number OC 356207 and Legal Entity Identifier(LEI) 549300V7YSH2IZ841X25 . Its registered address is at 33 Cavendish Square, London W1G 0PW. H2O Asset Management L.L.P.’s registered VAT Number is 103684235

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H2O AM Europe SAS

H2O AM Europe SAS is registered in France with a share capital of 13,500,000 euros, SIREN n°843082538 Paris and legal entity identifier(LEI) N° 9695000GQ2JLFQA4JX30. Its registered office address is at 39, avenue Pierre 1er de Serbie 75008 Paris, France. H2O AM Europe SAS’s registered VAT Number is FR77843082538.

H2O AM Europe SAS is an asset management company, authorised and regulated by the Autorité des marchés financiers (“AMF”). The AMF agreement number is GP-19000011. The AMF Register can be accessed at https://www.amf-france.org.

H20 Monaco

H2O Monaco is registered in Monaco with a share capital of 450,000 euros, Registration number 17S07498 and Legal entity identifier (LEI) N° 549300P23I30JJWXGS37 .

Its registered address is at 24, BD PRINCESSE CHARLOTTE ET 1, IMPASSE DE LA FONTAINE 10 ETG N° B10 – 98000 MONACO – MC PRINCIPAUTE DE MONACO

H2O Monaco is authorized by the Commission de Contrôle des Activités Financières (CCAF) to carry out the following activities as mentioned in points 4.1 and 6 of article 1 of law n°1.338 of September 7, 2007:

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The CCAF agreement number is SAF 2017-04.

H2O AM ASIA PTE.LTD.

H2O AM ASIA PTE.LTD. is registered in Singapore with a share capital of 500,000 Singapore $, Registration number 201827907K and Legal entity identifier (LEI) number : 5493004DGLQ0FP9NFO63.

Its registered address is at 12 Marina Boulevard #17-01 – Marina Bay Financial Centre Tower 3 – Singapore 018982

H2O AM SWITZERLAND SA

H2O AM SWITZERLAND SA is registered in Switzerland with a share capital of 200,000 CHF, Registration number CHE-167.132.256.

Its registered address is rue Cornavin 11, c/o DYN Genève SA (CHE 372.076.788) – 1201 Genève.

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Publications director: Loïc Guilloux, CEO and Partner

Editor-in-chief: Marc Maudhuit, CEO H2O Asset Management LLP

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Dodd Franck act
Users are informed that the products and services presented on this site may only be offered in jurisdictions where their marketing and promotion are authorized.
Consequently, access to the information and/or documents concerning the products and services offered on this site may be restricted or prohibited to legal entities or individuals who, by reason of their nationality, residence, registered office/registration or any other reason, are subject to a foreign law that imposes specific restrictions or obligations on H2O with respect to the marketing and promotion of these products and services in that jurisdiction.
In this respect, the information on this site does not constitute, in any way, an offer to sell or a solicitation, direct or indirect, to subscribe to financial instruments and units of account in the case of life insurance:
– in particular in the United States of America or,
– from US residents or,
– by nationals of certain countries, including the United States of America.
The user is asked to ensure that he/she is legally authorized to connect to this site in the country from which the connection is established, and that there is nothing to prevent him/her, with regard to his/her legal status, from subscribing to the products and services offered on this site, in particular the financial instruments.

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If any provision of these Terms is found by a court or regulator to be invalid of unenforceable the other provisions shall continue to apply.

CLIENT COMPLAINTS – please refer to the dedicated policy here

Our priority is client satisfaction. For that reason, we pay close attention to client’s complaints relating to H2O AM’s products and/or services. We commit to examine your request and answer your complaint on time. H2O AM’s complaint-handling system deals with any client complaints accurately, in a uniform way and in accordance with the applicable regulation. Access to the complaints service is free-of-charge, and clients can lodge their complaint, in French or English.

Definition of complaints

A complaint is considered as an expression of dissatisfaction (oral or written) about the provision of, or failing to provide, a financial service. It alleges how you have suffered (or may suffer):

  • financial loss;
  • material distress; or
  • material inconvenience

A request for information, opinion, clarification, service or provision of a service does not constitute a complaint.

Handling complaints

Complaints may be sent by post, telephone and/or e-mail, or may be provided via the client’s usual point of contact.

  • By Telephone: The Client’s usual point of contact
  • By Post:
    • H2O Asset Management L.L.P.: 9th Floor, 33 Cavendish Square, W1G 0PW, London, United Kingdom
    • H2O AM Europe SAS : 5th Floor, 39 avenue Pierre 1er de Serbie 750008 Paris, France
    • H20 Monaco : 24, BD PRINCESSE CHARLOTTE ET 1, IMPASSE DE LA FONTAINE 10 ETG N° B10 – 98000 MONACO – MC PRINCIPAUTE DE MONACO
    • H2O AM ASIA PTE. : 12 Marina Boulevard #17-01 – Marina Bay Financial Centre Tower 3 – Singapore 018982
    • H2O AM SWITZERLAND SA : rue Cornavin 11, c/o DYN Genève SA (CHE 372.076.788) – 1201 Genève
  • By Email: The Client’s usual point of contact AND/OR complaints@h2o-am.com

Processing deadlines

  • H2o AM Group entities are required to acknowledge receipt of all complaints within the timeline of 5 business days. H2O AM Europe has the same objective but this timeline can be expanded to 10 days from the date on which the written complaint is sent.
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Ombudsman
As a last resort and if you are not happy with our final response you may refer your request, free of charge, to the Ombudsman according to jurisdiction where complaints shall be addressed. The Ombudsman must be referred to within a year of the complaint submitted to H2O AM and only after all the internal remedies mentioned above have been used.

United Kingdom:

The Financial Ombudsman Service can be contacted in a number of ways:

France:

The AMF Ombudsman Service can be contacted in a number of ways:

Monaco :

The Ombudsman Service can be contacted

Singapore:

The Financial Industry Disputes Resolution Centre Ltd (FIDReC) is an independent and impartial institution that resolves consumer financial disputes through mediation and adjudication. It can be contacted in a number of ways:

Switzerland:

Association Finanzombudsstelle Schweiz (FINOS) is a neutral institution to develop consensual solutions for all parties within the framework of mediation and thus avoid costly legal disputes. Their ombudsman service deals with questions and complaints from clients of our affiliated financial services providers.

By post : Talstrasse 20 CH-8001 Zürich

By website : Info@finos.ch

Data Protection

According to Data Protection Act (DPA) and General Data Protection Regulation (GDPR), H2O AM is required to retain Personal Data for as long as is necessary for the purpose for which it has been collected. Where Personal Data is no longer required this will be disposed of securely in accordance with H2O AM’s Data protection and Privacy Policy.

Record Keeping

When complaint has been settled, the complaint record and associated correspondence will be retained the records for at least five years from the date the complaint was received. The date on which the complaint was resolved will be recorded. All complaints records, even in relation to minor complaints and those complaints resolved within one business day will be maintained for 5 years in relation to MiFID business.

Reporting to the FCA

Twice a year H2O AM will provide the FCA with a complete report concerning complaints received from eligible complainants including those settled within 3 business days.

Nature of commitment to the UK Stewardship Code

Under the Financial Conduct Authority’s (FCA) Conduct of Business Sourcebook Rule 2.2.3, H2O Asset Management LLP (H2O) is required to make a public disclosure on its website in relation to its commitment to the Financial Reporting Council’s (FRC) Stewardship Code (hereafter, the Code).

In October 2019, a substantially revised and strengthened UK Stewardship Code was published and took effect on 1 January 2020. The revised version comprises a set of twelve Principles, implemented on an ‘apply and explain’ basis. These Principles apply to asset managers and asset owners, with a separate set of six Principles applying to service providers. The revised Code defines stewardship as “the responsible allocation, management and oversight of capital to create long-term value for clients and beneficiaries leading to sustainable benefits for the economy, the environment and society.”

Whilst H2O strongly endorses this definition of stewardship and the purpose of the Code, we are currently not a signatory due to the nature of our investment approach, which is essentially top-down and global macro.

H2O’s investment strategy is driven by views on the government bond, credit and currency markets, with the majority of positions taken through derivative contracts such as futures, and with limited allocation to individual equity securities and corporate bonds. We are currently exploring possible approaches to exercising stewardship activities across our investment universe, notably by incorporating ESG criteria into our investment decisions (Principle 7). We will therefore review our approach to the Code in the future and update this disclosure accordingly.

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The full version of H2O Data Privacy and Protection Policy is made accessible on this website.

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  • “Audience analysis cookies”: these cookies are stored for statistical purposes. In particular, we record the number of page views, the number

of visits, as well as visitor activity on the website and the number of times people return, using AT Internet® solutions. These cookies are not stored for more than 13 months.

  • “Audience analysis cookies” used by the http://www.h2o-am.com website (set by xiti.com):
    • idrxvr Audience analysis
    • tmst Audience analysis
    • Social network cookies: Social networks such as LinkedIn, Twitter, Google+ and Facebook are likely to set cookies. The presence, number and status of these cookies depend on your use of these platforms before and during your visit to the website. Please view the cookies policy of the relevant social networking sites.

Managing cookies

Monitoring and deleting: If you would like to change the way your browser uses cookies, or to disable cookies, you can do so in your browser settings. Most browsers allow you to accept or reject all cookies, to accept only certain types of cookies, or ask you each time a website wants to store a cookie. They also allow you to delete cookies stored on your computer. In order to manage cookies in the way that best meets your needs, you can change your browser settings based on its configuration to control or prevent cookies from being stored:

  • Internet Explorer™: Tools Menu > Internet Options > Privacy

(See http://windows.microsoft.com/en-us/windows-vista/Block-or-allow-cookies)

  • Safari™: Safari Menu > Preferences > Privacy

(See http://support.apple.com/kb/PH17191?viewlocale=en_US)

  • Chrome™: Chrome Menu (tools) > Settings > Show advanced settings > Privacy > Content settings > Cookies

(See https://support.google.com/chrome/answer/114662)

  • Firefox™: Tools menu > Options > Privacy > History > Cookies

(See https://support.mozilla.org/en-US/kb/enable-and-disable-cookies-website-preferences)