The Advantages of Launching your Investment Funds in Luxembourg?

According to Damalion, an independent consulting firm located in Luxembourg, Luxembourg’s Asset under management (AUM) has been nothing but excellent in recent years. A Deloitte study conducted on behalf of the Association of the Luxembourg Fund Industry, confirmed the number of Private equity (PE) managers that have chosen the Grand Duchy as their European domicile experienced a 50% increase in private equity funding since 2018.

Massive 50% Increase in Private Equity Fund AuM and Doubling of €1 Billion+ Funds

Apart from the increase of PE funds domiciled in Luxembourg since 2018, the country also reported a boost in PE funds holding assets worth more than €1 billion, with a total of 36 funds in 2019. The average fund size is now at €200.6 million, with Luxembourg accounting for up to 4.3% of the world’s private equity industry.

The ever-changing private equity landscape inspires fund managers to establish stable and long-term operations in Luxembourg. Savvy investors prefer the fund structuring toolbox of the Grand Duchy as it offers a wide array of investment vehicles, specialized assets expertise, and its very own Financial Supervisory Authority Commission (CSSF).

The Alternative Investment Fund Managers Directive launched new organizational requirements and disclosure rules in relation to fund managers that oversee AIFs for non-listed companies and issuers. The alternative investment industry now follows a promising network similar to the UCITS Directive. Important pointers included in the ALFI study are as follows:

• Assets under management (AuM) of PE funds in Luxembourg increased by 19%, bringing the total AuM to €148 billion, with 57% of PE funds featuring a five-year investment duration or more.
• PE funds under the RAIF structure are up 20 points, representing 51% out of all PE funds in Luxembourg- a substantial increase given unregulated partnerships only accounted 31% of all PE funds in 2018.
• PE houses, including North American PE houses are moving their fund structuring in Luxembourg. Hedge fund managers prefer Luxembourg in setting up parallel vehicles for mega funds as opposed to exotic jurisdictions such as Bermuda and Cayman Islands, due to the OECD promoting its structured products and services. North American PE houses now represent 8% of Luxembourg’s private equity fund population.

Luxembourg is the gateway to European investments. Luxembourg’s business-friendly landscape and the introduction of the Reserved Alternative Investment Funds (RAIF) draws more private equity managers to set-up shop in Luxembourg as these components complete a comprehensive and beneficial investment fund toolbox. Damalion is a Luxembourg independent consulting firm that facilitates setup and management of Luxembourg investment funds thanks to its network of accredited and vetted professionals.

DAMALION
8-10 rue Mathias Hardt
L – 1717 Luxembourg
T: +352 20 33 1 123
Press enquiries : Ashley DESJARDINS
ashley@mydamalion.com

Damalion is an independent consulting firm that helps entrepreneurs, family businesses, corporates and more to make their vision live. Damalion supports your business for Business Recovery & Revitalization, Strategy consulting & Growth strategy, Business model innovation, IT & New Technologies, 360 ° Compliance & Risk - ESG, Corporate structuring, Directorship & Company formation, Training & Coaching. We support our international clientele for their asset protection and wealth preservation thanks to strategic holding companies and sustainable succession planning.

This release was published on openPR.