Luxembourg: the jurisdiction of choice for structuring
Private Equity
Benefiting from a flexible tax and legal environment
Luxembourg has been recognised for many years as a
pre-eminent jurisdiction for structuring private equity
funds and private equity deals. In a recent survey(1)
conducted by the European Venture Capital Association,
Luxembourg ranked second most favourable jurisdiction
in Europe for the development of the Private Equity
industry.
The launch in June 2004 of the SICAR ("société d'investissement
en capital à risque") as an investment vehicle dedicated
to Private Equity and Venture Capital is the latest
illustration of Luxembourg commitment to your industry.
The Challenge
You intend to set up a pan-European or global private
equity fund and/or your Fund will invest, through
various instruments, in European companies. Also,
as part of achieving your targeted return on investments
you look at optimising the tax burden of your cross-border
transactions. In this context you are faced with legal,
fiscal and regulatory complexities in various jurisdictions
and you find it difficult to coordinate between these
jurisdictions.
PricewaterhouseCoopers solutions
We provide a full range of services to assist both
start-up and institutional clients in establishing
their funds and operations through any phase of the
private equity investment lifecycle:
Structuring and financing
- Providing assistance regarding the choice of
an appropriate domicile and organisational structure;
- Review, consultations and liaison with the local
regulatory authorities, where and if appropriate;
- Advice and consultation regarding financial,
regulatory and fiscal compliance requirements;
- Working with legal counsel and administrator
to create the documents necessary for the establishment
and offering of the private equity structure.
Investment period strategy
- Deals origination and M&A financial advisory
(acquisition mandates);
- Financial, tax and market due diligences;
- Valuation of investee companies;
- Deals tax structuring.
Holding period
- Audit services for funds and intermediate structures,
specific attest reports (reorganisations, refinancings);
- Providing assistance in recordkeeping and in
the reporting process to respond to your specific
needs and objectives, and to meet the needs of
your investors.
Exit Strategy
- Valuation of investee companies;
- Vendor due diligence;
- M&A financial advisory (disposal mandates);
- Regulatory, tax and accounting advice regarding
the repatriation of funds to investors.
Benefits for you
PricewaterhouseCoopers Luxembourg Private Equity
Group can provide you with innovative tailored-to-your-needs
solutions in structuring your private equity fund
or your investments in Private Equity. Our integrated
approach to problem solving involves a local and international
network of private equity accounting, tax, regulatory,
financial and consulting professionals who can quickly
mobilise to form highly qualified teams.
Why PricewaterhouseCoopers Luxembourg?
We have a recognised global and local network of
professional advisors who have extensive experience
advising Private Equity houses and individuals knowledgeable
in structuring, establishing and operating private
equity strategies and products. Our multidisciplinary
teams have the practical experience and the technical
expertise to provide responsive, timely and value-added
advice to your business.
Private Equity has been a key focus area of our firm
for the last years, which shows our total commitment
to your industry. In Luxembourg, our clients list
contains major players in the Private Equity industry
and we audit Private Equity funds with total assets
in excess of one billion EUR.
Our expertise in Private Equity encompasses financial
advisory in M&A transactions, financial, tax and market
due diligences, tax advisory and auditing of funds
or intermediary structures by specialised accountants
who are supported by our Valuation experts. As a global
organisation PricewaterhouseCoopers has developed
extensive thought leadership in the Private Equity
industry as illustrates below a selection of our actions:
- PricewaterhouseCoopers has contributed to the
"Consultation Document - Valuation Guidelines
for private equity and venture capital" (February
2005) for the AFIC, BVCA and EVCA, which has led
to the new EVCA Valuation Guidelines;
- We have recently publicised the "European Private
Equity tax survey", which is a pan-European survey
conducted amongst a number of Private Equity houses
in Europe looking at how fiscal matters are considered.
This survey is available on our website;
- We conduct several surveys amongst the Venture
Capital community. Most notable are The
MoneyTree Survey, which survey on a quarterly
basis the investment activity in the US, and VC
BestPractices Survey, which is a periodic study
of processes, policies, and views of the general
partners, CFOs, controllers and others who take
part in managing the day-to-day operations of
a venture
capital firm;
- We publicise the Global Private Equity Survey,
which is conducted on an annual basis by PricewaterhouseCoopers
and 3i. Such publication is available on http://www.pwcmoneytree.com/;
- PricewaterhouseCoopers organises a Private
Equity Club, held in London to which more than
70 investment management companies active in Private
Equity have subscribed. Our Luxembourg Private
Equity and Venture Capital experts are also speakers
at the Club.
Note:
(1) (Source: "Benchmarking European Tax and Legal
Environments", EVCA, May 2004)
