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Our full-service Investment Funds team is led by lawyers based in New York, London, Hong Kong, Beijing and Tokyo, with support from our global network of offices. By combining our multidisciplinary knowledge with a globally integrated approach, we provide a comprehensive range of investment funds services to clients on a worldwide basis. We have extensive experience assisting fund sponsors and investors across the Americas, Asia, Europe and Africa in finding innovative solutions to the challenges they face. We are skilled at reconciling complex regulatory and tax regimes with the competing requirements of fund sponsors, their investment strategies and their target investors. Clients appreciate our commitment to reviewing and negotiating fund structures and documents not only in light of current market terms, but also to advance their specific business objectives and specialized needs. Both registered and unregistered investment funds and their advisers regularly depend on us for assistance on the full spectrum of transactional and regulatory matters.

Our clients include the full spectrum of investment funds, including private equity, hedge, real estate, venture capital, registered mutual (both open-end and closed-end) and UCITS funds, sponsored by some of the highest-profile global fund managers. We work extensively either with or opposite each major category of investor in private funds, including corporate, public and private pension plan, private family, foundation and endowment, fund of funds, sovereign wealth fund and quasi-governmental organization investors. We also represent the wealth management arms and private banks of international financial institutions, family offices, institutional investors, commodity pool operators and leading fund administrators.

Fund Formation Capabilities 

Shearman & Sterling regularly advises investment funds and their sponsors on all aspects of raising capital, including the structuring and formation of numerous forms of alternative investment products and managed account services. We are also experienced at structuring a global overlay to existing local fund structures to position funds for offerings in the United States, Europe and Asia.

Our fund formation attorneys regularly draw upon their experience in advising on the structuring, formation and ongoing operations of the following:

  • Private equity funds
  • Private equity funds of funds
  • Real estate funds
  • Infrastructure funds
  • Debt funds
  • Co-investment funds
  • Distressed asset funds
  • Venture capital funds
  • Segregated portfolio companies
  • Captive funds
  • Pledge funds
  • Feeder funds
  • Hedge funds
  • Registered and unregistered funds of hedge funds
  • Hybrid funds
  • Registered mutual funds
  • Registered investment companies
  • Registered closed-end funds
  • Exchange traded funds (ETFs)
  • Mutual fund wrap fee programs
  • Principal protected funds
  • Business development companies
  • Specialized pools for structured finance instruments
  • Shari’ah compliant funds

We understand the unique tax structures of investment vehicles across jurisdictions and are familiar with various local pension structures and investment requirements. Our team has strong relationships with placement agents and other fund service providers.

Hedge Funds 

Shearman & Sterling has long served as counsel to many of the world’s largest and most successful hedge fund firms, an array of emerging managers and numerous other market participants that have played pivotal roles in shaping the hedge fund industry. Our full-service hedge fund team is led by lawyers based in New York, London and Hong Kong, with support from our global network of offices.

Utilizing a multidisciplinary approach, our lawyers work together to provide our hedge fund sponsor and investor clients with integrated advice on all aspects of their most important and challenging business goals. Our global platform enables us to provide seamless guidance on cross-border matters, as well as the continually evolving regulations that impact the hedge fund industry globally.

We regularly advise hedge fund sponsors and investors on fund formation and operational matters, including valuation, liquidity, high-frequency trading and management company structures, as well as tax, ERISA and incentive compensation matters. We provide counsel on leveraged transactions, derivatives and trading, strategic investments and asset manager M&A. In addition, we assist our clients with regulatory compliance matters, such as SEC, CFTC, FCA and SFC registrations and exemptions, Dodd-Frank Act and Volcker Rule analysis, and advice on the AIFMD and EMIR. We also assist our hedge fund clients with regulatory inspections, investigations, litigation and enforcement defense (including insider trading and anticorruption matters).

Private Equity Funds 

Utilizing our global, multidisciplinary platform, Shearman & Sterling’s Private Equity Funds team advises fund managers and investors around the globe on the full spectrum of private equity fund matters. Our experienced attorneys based in North America, Europe and Asia collaborate seamlessly to deliver integrated advice on complex cross-border matters.

We regularly advise fund sponsors and investors on the design and development of investment products and services, including private equity funds, private equity funds of funds, venture capital funds, debt funds and infrastructure funds. Clients come to us for advice on how to achieve the most advantageous investment structures from an economic, tax, legal and regulatory perspective.

We regularly assist clients with:

  • Fund structuring and formation (including tax and ERISA structuring)
  • Transactional matters, including private equity M&A, co-investments, capital markets transactions (including IPOs), recapitalizations and portfolio company financings
  • Ongoing business matters, including secondary sales, transfers, spin-outs, seed investments and asset manager M&A
  • Internal arrangements, including leverage facilities, management company structures, succession issues, employee incentive plans and other employment matters
  • Troubled portfolio companies, including restructurings, bankruptcy and litigation, and investor defaults
  • Structuring a global overlay to existing local fund structures to position private equity funds for offerings in the United States, Europe and Asia

Our private equity M&A team has in-depth experience advising and executing on a wide array of private equity and venture capital investments worldwide. By using our cross-border and interdisciplinary capabilities, we regularly advise clients across numerous industries on ERISA matters, optimal tax structuring and other investment structuring matters.

Private Fund Investors 

Shearman & Sterling regularly represents major investors in the global private fund asset class, including sovereign wealth funds, family offices, corporations, funds of funds, high-net-worth individuals, pensions, endowments, private foundations, charitable organizations and quasi-governmental organizations, including development finance institutions. We assist our clients with reviewing and negotiating fund structures and fund documents, as well as managed accounts, in light of market terms and their specialized needs.

Our experienced attorneys assist fund investors with all aspects of their investments, including negotiating side letters, resolving tax, regulatory, policy and reporting matters, assisting with investment closings and advising on post-closing fund manager communications and amendment requests. For clients that have an ongoing private fund investment program, we also prepare terms checklists and template side letters to help ensure consistency across investments. In addition, we have significant experience advising on portfolio sales, co-investments and investments in asset managers.

We also work with our Financial Institutions Advisory & Financial Regulatory team to represent global financial institutions and their investment management divisions in the creation of customized investment products for their high-net-worth and institutional clients, including private equity and hedge feeder funds, managed accounts and direct investment programs. We advise on the most advantageous investment structures from an economic, tax, legal and regulatory perspective. Our financial institution clients value the range of global capabilities we offer for all aspects of their investment management businesses.

Registered Funds 

Drawing on our wealth of knowledge and experience, we regularly advise fund management organizations, fund families and independent directors with respect to funds registered under the U.S. Investment Company Act and European regulatory regimes. Our clients include both traditional mutual fund firms as well as innovative registered investment companies. Our team has been instrumental in the formation and structuring of groundbreaking registered funds products, including one of the first and now the largest registered fund of hedge funds. We have also been involved in some of the highest-profile launches of “registered alternatives” vehicles.

Clients regularly come to us for assistance on structuring, formation and launch of registered investment funds, regulatory inspection and enforcement matters as well as corporate transactions involving U.S. asset management businesses. In the United States, we counsel clients on SEC and other regulatory inspection and enforcement matters and represent registered funds and advisers before the SEC, FINRA, CFTC, NFA and FCA. In the United Kingdom, we advise fund managers, advisers and promoters on the boundaries of U.K.-regulated activities. We are also experienced in EU-wide legislation relating to the registration of regulated funds (UCITS), the structuring, establishment and marketing of those funds and the marketing of transferable securities.

In addition, we have extensive experience advising on corporate transactions (adviser and sub-adviser arrangements, M&A activity, joint ventures, strategic alliances, spin-outs, restructuring matters and changes in portfolio management) involving U.S. asset management businesses, including acquisitions and mergers of individual registered funds (“fund adoptions”) and fund complexes.

Real Estate Funds & REITS 

Shearman & Sterling maintains a diverse and sophisticated Real Estate Funds practice, offering our clients demonstrated experience across the full range of real estate fund sectors. With team members across the firm, we provide the full breadth of knowledge and capabilities relevant to real estate fund formation, fund management and co-investment transactions.

Our cross-border and multi-disciplinary team advises clients on the design and development of a variety of products covering multiple asset classes, including real estate equity funds (core, core plus, value-added and opportunistic), real estate debt funds and Shari'ah compliant funds. We assist our clients with fund formation, tax planning, co-investment structuring, property acquisitions and dispositions, financing and leasing transactions, REIT offerings and internal sponsor arrangements. Our experience includes the formation and structuring of both closed-end and open-end funds.

We have significant REIT experience that is recognized throughout the globe. We have advised on the organization, financing and management of REITs for decades, and our transactions cover REITs with investments in all classes of REIT-qualified assets, including office, retail, hotel, residential, multifamily, data center, industrial, student housing and GSA properties.

Clients come to us for assistance in drafting fund documentation, preparing related agreements (including property management, leasing and credit agreements) and negotiating with investors and other counterparties. We also provide structuring and formation advice on feeder and blocker vehicles (including private REITs) that might be utilized for the benefit of particular categories of real estate fund investors (including non-U.S. and U.S. tax exempt investors).