Emerging Companies Fund

Early-entry to major growth companies | 2024 - Tranche 1

Product Type

Managed Fund

Distribution

10% p.a

Payment

Quarterly

Term

3 Years

Summary

The Emerging Companies Fund gives investors exposure to Gleneagle’s proprietary strategy and the opportunity to co-invest with us. 

Technological advancements, societal shifts, economic conditions, geopolitics, and unexpected global events such as the pandemic, play pivotal roles in shaping the investment landscape.

Over decades of global metamorphic change, entire industries have been birthed, evolved, matured, and for some, diminished. With so much opportunity in the market, the most arduous task for investors is identifying which upcoming ventures to pay attention to.

Innovation and technologies create opportunities for new industries and disrupt existing ones.

Economic cycles, regulatory changes and events like energy crises drive sector rotation and create shifts in demand.

Globalisation opens up new markets, while environmental, social, and governance (ESG) considerations impact investor sentiment and allocation.

Fund Objectives

Gleneagle seeks to leverage global thematics by acquiring early-entry into listed or unlisted companies that align with these themes and are uniquely positioned for exponential growth.

The fund seeks to pay 10% p.a income to investors throughout the 3-5 year term, with final profits realised and distributed at maturity.

Short Term Objectives
Income Paying
10% p.a
Distribution to Investors
Quarterly
Long Term Objectives
High Growth
Capital Appreciation
3-5 Year Maturity
Final Profits Realised

Sophisticated Investors

To be considered for this investment product; applicants must supply evidence they qualify as a Sophisticated Investor

Emerging Companies Fund

Global trends

Thematic trends can help to indicate transformative shifts in market, highlighting specific industries and niches for long-term opportunity.

Exceptional Leadership

Driven, passionate, and talented teams build the best companies. Incentives and equity holdings must also be financially aligned with shareholder objectives.

Ripe for Expansion

There’s a sweet spot between reaching initial revenue milestones but yet to take off. The strategic plan must cement their trajectory of scaling rapidly and generating sustainably high margins.

Investment Terms

Distribution

10% p.a

Payment

Quarterly

Term

3 Years

Investment Overview

Gleneagle Asset Management Limited (ABN 29 103 162 278, AFSL No. 226199) (Gleneagle) has established the Fund to facilitate Eligible Investors acquiring an economic interest in listed or unlisted emerging companies.

The Fund’s sole purpose is to invest in these companies.

Investment Universe
Listed and unlisted global equities and global swaps.
Legal Structure and Currency
The Fund is an Australian unit trust. Units in the Trust (Units) are fully paid. This class of Units are referred to as Tranche 2. All dollar amounts referred to in this Term Sheet are in Australian dollars.
Trustee and Manager
Gleneagle Asset Management Limited (ABN 29 103 162 278, AFSL No. 226199) is the Trustee and Manager of the Fund.
Eligible Investors
Interests in the Fund are only available to persons who are wholesale clients for the purposes of the Corporations Act 2001 (Cth) (Corporations Act).
Target Raising
Gleneagle is proposing to raise $10 million, however the Trustee may close that class of Units and create a new class being the next tranche
Application Cut Off and Application Moneys

Applications will generally be processed on the first business day of each month.

The application form, wholesale status, any information requested and cleared funds (Approved Applications) must be received by the Trustee on or before the 25th of each month to be processed on the first business day of the next month, otherwise it will be processed the subsequent month. Application monies will be held in an account which may be interest bearing until invested in the Fund (or returned to the Applicant) and that interest (if any) earned on this account will be retained by the Trustee.

Minimum Investment
The minimum investment by any Investor will be $50,000 unless permitted by the Trustee. All subscription amounts must be paid in Australian dollars.
Closing Dates

The first close of Tranche 2 is expected to occur on 31 March 2024 (First Closing) for which Approved Application must be received no later than 25 March 2024. The issue price of a Unit issued on the First Closing will be $1.00.

Subsequent closings may be held at the discretion of the Trustee, provided that the final closing will occur no later than 12 months after the date of the First Closing being 31 March 2025 (Final Closing).

Term of the Fund

The Fund will have an initial term of 3 years from the First Closing ending on 31 March 2027 (3rd Anniversary), which may be extended by up to 2 additional extensions each of 1 year as determined by the Trustee in its discretion ending on 31 March 2028 (4th Anniversary) and 31 March 2029 (5th Anniversary), respectively.

The Trustee must give at least 1 months prior notice (Extension Notice Period) before extending the term of the Fund beyond the 3rd Anniversary and the further extension beyond the 4th Anniversary.

Withdrawal and Transfer from the Fund

Investments in the Fund are illiquid. Subject to the below, Investors have no right to redeem their Units prior to the 3rd Anniversary or, if the Fund is extended as referred to above, during either of the 2 extension periods.

If the Fund is extended beyond the 3rd Anniversary or the 4th Anniversary, Investors may request the redemption of their units after they receive an extension notice from the Trustee prior to the end of the relevant Extension Notice Period (i.e. by the 3rd Anniversary or the 4th Anniversary as applicable).

If a redemption request is accepted by the Trustee the redemption proceeds will generally be paid within 15 business days after the 3rd Anniversary or 4th Anniversary. The redemption of Units in such circumstances will be funded by selling assets and/or by borrowings secured by lodging stock owned by the Fund with the lender. Any interest charged by the lender will be paid from the assets of the fund.

However, the acceptance of all or some of the Units subject to redemption requests and the time for paying out any accepted redemption requests is at the Trustee’s absolute discretion. An Investor may only transfer any of its Units with the prior written consent of the Trustee in its absolute discretion.

Investors may seek to sell or transfer their units by notifying the Trustee in writing which will use commercially reasonable endeavours to facilitate the sale of those Units.

Distributions

The Trustee intends that the Fund will pay an annual distribution yield of 10% per annum (i.e. 2.5% per quarter), which may be paid out of the income or capital of the Fund and may be funded by borrowings secured by lodging stock owned by the Fund with the lender. Any interest charged by the lender will be paid from the assets of the fund.

Distributions will be paid in cash and payments will be made quarterly, based on the 2.5% per quarter in proportion to the time those Units have been invested in the fund for that quarter. Distributions cannot be reinvested in the Fund.

The Fund will not be distributing dividends that have franking credits for taxation purposes.

Operational costs and expenses
(including Administration,
Audit, and Registry Costs and Expenses)
Operational costs and expenses are costs incurred in managing the Fund which directly reduce the return on a product. The Trustee is entitled under the Trust Deed to be reimbursed out of the Fund’s assets for the costs and expenses incurred in the proper performance of its duties as the Trustee of the Fund. Operational costs and expenses include the fee charged by the Administrator, Auditor, Registrar and other expenses which relate directly to the Fund. The Trustee will be reimbursed operational costs and expenses of up to 0.5%1 per annum, of the Funds NAV (before Performance Fees and the operational costs and expense recovery) calculated on the last business day of each month and accrued monthly in arrears and paid within 15 business days after the month end out of the Fund’s assets.
Establishment Fee
The Trustee is entitled to receive a once off establishment fee of 4%1 paid out of each investor’s subscription amount which will be used to, without limitation, fund the establishment costs and expenses below.
Establishment Costs and Expenses
All costs incurred in the establishment of the Fund and other operational costs and expenses not recovered from the Fund, will be paid by the Trustee in its personal capacity from the establishment fee. Transaction costs incurred in relation to the acquisition of the Fund’s assets or its borrowings will be borne by the Fund.
Performance Fee
  • 20%1 of the surplus (if any) of the aggregate of all realisation proceeds (including income and capital) received by the Fund above the amount invested in the Fund; or
  • 30%1 of the surplus of the aggregate of all realisation proceeds received by the Fund above the amount invested in the Fund, if the surplus is 300% above the amount invested in the Fund.
The Performance fee will not be accrued based on unrealised assets. If the performance fee is payable, it will generally be paid within 15 business days after the month end in which the assets were realised out of the realisation proceeds.
Risks

The risks of investing in emerging companies i.e. early stage ventures is typically seen as a highly risky venture, with the potential to bring in high returns. Emerging companies aren’t a commonality and only a limited number succeed. It is not suitable for conservative or risk-averse investors or those who cannot recover from capital loss or have a short term outlook. There is also the liquidity risk and sellers might have to wait for liquidity events to get their money out.

The other risk is majority control where the founders' interests might be poorly aligned with those of small investors. Gleneagle Group, its partners and our sophisticated investors already have significant holdings in those emerging companies. The risk is decreased as Gleneagle may also seek to appoint a representative of the Fund to the company’s board, providing further opportunity to apply strategic influence, pivot business strategy and facilitate growth.

1All fees, charges and other costs have been stated exclusive of any Goods and Services Tax (GST) and any reduced input tax credits (RITCs) unless otherwise specified.

Track Record

Zip_Logo
Entry
90c
Exit
$3.60

+300%

Zip Co is a leading player in the global 'buy now pay later' financial technology industry.
Sirius Logo
Entry
20c
Exit
$3.00

+1400%

Independence Group acquired Sirius Resources for $4.38 per share / 1.8b.
hub24-logo-dark
Entry
60c
Exit
$5.00

+733%

HUB24 is a technology, data, and platform provider to the wealth management industry.
Chalice Logo__
Entry
45c
Exit
$7.20

+1500%

Chalice Mining is an exploration and production company, focusing on nickel, copper, cobalt, and gold.
Afterpay_logo
Entry
$2.00
Exit
$56.00

+2700%

Gleneagle backed this financial technology company in its very early stages.
Nickel Mines Logo
Entry
30c
Exit
75c

+150%

Gleneagle backed Nickel Mines' good management, which returned significant growth.

This is Gleneagle’s proprietary and its Beneficial Owners’ track record of investing in emerging companies that were successful. The percentages reflect the approximate realised gain. Past performance is not an indicator of future performance.

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Emerging Companies Fund

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Emerging Companies Fund

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