• Private Companies:

  • Objective:

    • Acquire private companies that demonstrate potential for growth or restructuring.

  • Investment Size:

    • Typically ranges from $5 million to $50 million per acquisition.

  • Involvement:

    • Active management and operational involvement to drive business improvements and growth.

• Public to Private Acquisitions:

  • Objective:

    • Identify undervalued public companies and take them private to optimize operations and strategic direction away from public market pressures.

  • Investment Size:

    • Ranges from $20 million to $200 million per acquisition, depending on the market cap and strategic fit.

  • Involvement:

    • Post-acquisition, implement strategic changes, cost efficiencies, and revenue enhancements.

Selection Criteria

• Valuation and Upside Potential:

  • Focus on companies trading at attractive valuations relative to their intrinsic value and growth potential.

• Operational Efficiency:

  • Look for opportunities where operational improvements can significantly enhance profitability.

• Management Quality:

  • Evaluate the strength of the company’s existing management or potential to bring in high-caliber leadership.

• Market Position and Competitive Advantage:

  • Assess the company’s market position, competitive advantages, and barriers to entry.

Fund Structure

Diversification

• Portfolio Construction:

  • Number of Investments:

    • Target 10-15 companies per fund lifecycle to diversify across sectors and geographies.

  • Allocation:

    • Diversify investments to mitigate risk and capture multiple growth opportunities.

• Risk Management:

  • Due Diligence:

    • Comprehensive due diligence process including financial analysis, market assessment, and operational review.

  • Leverage:

    • Prudent use of leverage to enhance returns while managing risk exposure.

Rebalancing

• Frequency:

  • Review portfolio semi-annually to assess performance and realign with fund objectives.

• Criteria:

  • Adjustments based on company performance, market conditions, and strategic shifts.

Liquidity

• Investment Horizon:

  • Timeframe:

    • Target investment horizon of 5-7 years for each acquisition, allowing time for restructuring and value creation.

• Exit Strategy:

  • Types:

    • Options include strategic sales, secondary buyouts, IPOs, or recapitalizations.

  • Exit Planning:

    • Collaborate with portfolio companies to plan and execute exit strategies that maximize returns.

Fund Details

Management Fee

• Fee Structure:

  • Annual Management Fee:

    • 2% of the fund’s net assets.

  • Performance Fee:

    • 20% of profits above an 8% preferred return.

Dividend Policy

• Distribution:

  • Profits generated from the operations of acquired companies are used to pay regular dividends to investors.

• Frequency:

  • Quarterly Dividends:

    • Aim to distribute dividends quarterly, providing a steady income stream to investors.

Minimum Investment

• Initial Investment:

  • Minimum of $500,000 to participate in the fund.

• Subsequent Investments:

  • Additional investments can be made in increments of $100,000.

Marketing and Distribution

Target Audience

• Investor Profile:

  • High-net-worth individuals, family offices, and institutional investors seeking income-generating investment opportunities with exposure to buyout strategies.

• Investment Goals:

  • Ideal for those looking for a combination of income through dividends and potential capital appreciation from buyout investments.

Promotion

• Key Selling Points:

  • Access to private market buyout opportunities, steady dividend income, and active management to drive value creation.

• Channels:

  • Promoted through financial advisors, institutional channels, and direct marketing campaigns.

Educational Content

• Investor Resources:

  • Detailed information on the fund’s strategy, investment process, and historical performance data.

• Webinars and Seminars:

  • Educational sessions to explain the fund’s objectives, buyout strategies, and investor benefits.

Compliance and Administration

Regulatory Compliance

• U.S. Compliance:

  • Adhere to SEC regulations and other applicable U.S. financial laws.

• International Compliance:

  • Ensure compliance with relevant regulations in jurisdictions where investments are made.

• Audits:

  • Regular audits to ensure transparency and regulatory adherence.

Fund Administration

• Administrator:

  • Partner with a reputable fund administrator for daily operations, including investor transactions and reporting.

• Reporting:

  • Provide regular performance reports, including detailed statements on investments, dividends, and fees.

Custodian Services

• Selection:

  • Choose a reliable custodian for safekeeping of the fund’s assets and handling transactions.

Performance Monitoring

Benchmarking

• Metrics:

  • Regularly compare the fund’s performance against relevant benchmarks and market indices.

• Reports:

  • Detailed performance reports available to investors, highlighting returns, dividends, and portfolio composition.

Investor Feedback

• Surveys and Feedback:

  • Collect feedback from investors to assess satisfaction and make improvements to the fund’s strategy and operations.

• Advisory Board:

  • Consider forming an advisory board of industry experts to provide insights and recommendations.

Interested in Investing? Contact Us to learn more about the McKenzie Shanahan Buyout Fund and how you can benefit from our strategic buyout investments and dividend distributions.