LONDON, April 15, 2024 – WTW has today announced its proposal to launch a private equity-focused Long Term Asset Fund (LTAF), subject to FCA approval.
The proposed new fund, named the CG WTW Private Equity Access LTAF (or ‘CG WTW PEAL’) will invest in a range of private equity opportunities including co-investments, doing so via the new LTAF structure recently introduced by the FCA.
LifeSight, WTW’s defined contribution (DC) pensions master trust with 360,000 individual members, has agreed to allocate up to 5% of its LifeSight Equity default fund into private equity, via WTW’s new Private Equity Access LTAF (‘CG WTW PEAL’) announced today. The fund’s Alternative Investment Fund Manager (AIFM) Carne Global Fund Managers (UK) Ltd has submitted an application to the FCA for approval. The fund has received initial commitments of over £450m ahead of launch.
The new private equity LTAF will be the first time WTW’s institutional private equity business has offered a pooled fund to the market. This supports broader industry initiatives to better align the long-term investment needs of many end investors, including DC pension savers, and invest into assets that, historically, have been harder for DC and private investors to access.
The LTAF, which is anticipated to be available later this year, will offer investors dedicated private equity exposure. WTW believes that private equity investments, which historically have offered a high illiquidity premium, provide the greatest opportunity to maximise long-term returns from private markets and are therefore where all long-term illiquid DC asset strategies should start.
The CG WTW PEAL also includes mechanisms to ensure valuation alignment to the net asset value of the underlying assets and liquidity alignment to redemption timing. The process will include the use of a third-party valuer, adopting market best practise for investors into evergreen, semi-liquid funds investing into private markets.
As a structure, the LTAF is a new type of open-ended authorised fund, which the FCA introduced in 2021, designed to invest efficiently in long-term, illiquid assets. This can include a range of asset classes from venture capital and private equity to private debt, real estate and infrastructure.
“Crucially for end savers looking to grow their wealth, they will now be able to access dedicated private equity exposure through a regulated pooled fund structure, the first of its kind in the market.”
Ben Leach | WTW
Ben Leach, Head of Private Market Solutions in WTW’s Investments business, said: “The launch of PEAL is hugely exciting for investors and is the culmination of three years of development work. Crucially for end savers looking to grow their wealth, they will now be able to access dedicated private equity exposure through a regulated pooled fund structure, the first of its kind in the market.”
Jelena Croad, Head of LifeSight UK, comments: “LifeSight is committed to offering increasing value for members. Including private equity in the existing LifeSight default is expected to improve member outcomes and we are extremely proud to be able to offer this to members within our existing fee structure.”
Simon Ellis, Chair of Trustees for LifeSight comments; “The LifeSight Trustee puts members at the heart of everything we do. The Trustee has completed a lengthy and thorough governance process to ensure the suitability of the fund and its alignment with the Trustee’s commitment to member outcomes.”
CG WTW PEAL, is the first private capital evergreen, semi-liquid fund launched by WTW’s Private Markets Solutions Team. The team has plans for other long-term solutions to follow, focused on broadening its offering for savers across Europe and Asia-Pacific. In addition to DC pension savers, the PEAL will also be available to other institutional investors and individual professional investors.
The CG WTW PEAL fund is subject to regulatory approval, which is anticipated in the second half of 2024.
The information and opinions contained in this document are for use by the financial press and media only. No reliance may be placed for any purpose on the information or opinions contained in this document nor should they be seen as advice.
The press release is provided on the basis that WTW is not causing the communication of a financial promotion under exemption of the Financial Promotion Order, as WTW has no control over the way in which an article based on this press release is prepared and published by the financial press and media.
Except where stated as otherwise, the source of all information is WTW. Unless stated otherwise any views, opinions expressed are those of WTW. They should not be viewed as indicating any guarantee of return from an investment managed by WTW nor as advice of any nature. The value of an investment and any income from it may go down as well as up and the investor may not get back the original amount invested.
Towers Watson Investment Management Limited (“TWIM”) of 51 Lime Street, London, EC3M 7DQ, is authorised and regulated in the United Kingdom by the Financial Conduct Authority (FCA Register Firm Reference Number 446740, refer to the FCA register for further details) and incorporated in England and Wales with Company Number 05534464.
Towers Watson Limited (trading as Willis Towers Watson) (Head Office: Watson House, London Road, Reigate, Surrey, RH2 9PQ) is authorised and regulated in the United Kingdom by the Financial Conduct Authority (FCA Register Firm Reference Number 432886, refer to the FCA register for further details) and incorporated in England and Wales with Company Number 05379716.
Private markets refer to investments not traded on a public exchange or market.
Underlying private markets investments of the Fund will normally be in unlisted companies and assets whose securities are not publicly traded and are therefore likely to be illiquid. They carry substantially higher risk than many investments in the equity of larger, listed companies, their public debt securities, or in listed real assets.
WTW’s Investments business is focused on creating financial value for end investors through its expertise in risk assessment, strategic asset allocation, fiduciary management and investment manager selection. It has over 900 colleagues worldwide, more than 1,000 investment clients globally, assets under advisory of over US$4.7 trillion and US$187 billion of assets under management.
At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance.
Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you.
LifeSight is WTW’s master trust, a defined contribution multi-employer pension trust for employers who would benefit from high-quality, low-risk, market-competitive pension provision without the governance burden.
LifeSight was the first master trust to be authorised in February 2019 by the Pensions Regulator in the UK.
Founded in 2004, Carne Group is an international company that has established itself as an expert and pioneer in fund regulation and governance solutions, allowing it to become Europe’s leading third-party management company and trusted partner to the fund management industry.
Carne works with more than 650 clients - from boutique fund managers to global institutional investors - supporting funds distributed in over 160 countries and overseeing more than $2 trillion assets under management. Carne employs more than 700 employees worldwide.
