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For investors seeking regular, stable returns from a lower-risk vehicle
Target return (from 1 July 2019)
The Moelis Australia Fixed Income Fund (Fund) provides its investors (Investors) exposure to a diversified portfolio of credit investments in a unique fund structure designed to provide stable monthly cash distributions and a strong risk-adjusted return.
The Fund is underpinned by a material co-investment by Moelis Australia, which is used to prioritise Investor returns and significantly reduce Investor risk.
The firm will invest, alongside the Fund, an amount equal to 10% of the Fund’s capital, on terms that provide Fund Investors with the benefit of a capital buffer and income priority.
The terms of Moelis Australia’s co-investment mean:
(i) Moelis Australia’s capital will first absorb any realised losses, providing a buffer to protect Investor capital (Capital Buffer);
(ii) Investors benefit from prioritisation of income and capital; and
(iii) There is strong alignment of interest between Investors and Moelis Australia.
Moelis Australia will only ever receive a return on its co-investment if Investors have been paid the Target Return and Moelis Australia’s Capital Buffer is equal to 10% of the Fund’s capital.
Structure: Australian wholesale unit trust (unregistered managed investment scheme)
Target Return (from 1 July 2019) RBA Cash Rate + 4.00% p.a. (currently 5.50%) net of fees
ASX listing: Target IPO in second half of 2019. Fund Investors will be offered a priority allocation in any IPO capital raising
Fund term: Open-ended fund. As it is proposed to list the Fund on the ASX by the end of 2019, redemptions are not intended to be provided prior to such listing. If the listing is not achieved in 2019, Investors may request that the Manager redeem part or all of their capital by providing a redemption notice prior to the end of the calendar quarter
Eligibility: Wholesale investors only
Minimum Investment: A$100,000
Applications Due: 20 June 2019 (units to be issued 1 July 2019)
Valuation: At least semi-annually based on Net Asset Value (NAV)
Fees: Management fee of 0.50% charged by the Manager at the portfolio level
Upfront offer costs will be borne by Moelis Australia, not the Funds
Research: IIR (Recommended Plus)
A copy of the report is available here.
Dates are indicative only and may change at the discretion of the Trustee, Moelis Australia Asset Management Ltd.
DISCLAIMER Moelis Australia Asset Management Ltd (ACN 142 008 535) (AFSL 427515) is the trustee of the Moelis Australia Fixed Income Fund (the Fund) and has appointed Moelis Australia Funds Management Pty Ltd [ACN 631 552 896] as investment manager of the Fund (Manager), Investors should refer to the Information Memorandum and consider seeking professional financial and taxation advice before deciding whether to invest in the Fund. Neither Moelis Australia Asset Management Ltd, the Manager or any of their respective related parties guarantees any performance or the return of capital invested. Past performance is not a reliable indicator of future performance. Investments are subject to risks, including, but not limited to, possible delays in payments and loss of income or capital invested. Opinions contained herein may be subject to change without notice and do not constitute investment advice or recommendation. Offers of interests in the Fund are contained in the Information Memorandum dated May 2019 which is available from Sarah Sagvand on (02) 8288 5594.
The offer to acquire interests in the Fund is contained in the Information Memorandum dated May 2019 and is only open to institutional, sophisticated and wholesale investors as defined in section 761G of the Corporations Act 2001 (Cth).