London & Capital plots PE push – Exclusive

The wealth manager sees an opportunity to provide a one-stop shop for individuals and firms.

Wealth management business London & Capital is launching what it describes as a ‘Private Equity Office’ in a bid to build its client base in the industry. Within the service, London & Capital will offer investment services to both individuals and the firms themselves.

“We are well practiced at working with fellow investment professionals without treading on their toes,” said Iain Tait, partner at London & Capital, who added that typically those who invest professionally will often end up holding a lot of cash, because they don’t readily trust others to manage it.

The firm has also established itself as a manager of institutional and corporate wealth; about a third of its business is institutional, Tait said, predominantly managing pools of capital for insurance companies.

“What is new for us is applying these two disciplines together, tailored for the specific needs of private equity clients,” said Tait.

By taking into account the entirety of the private equity firm’s operations, London & Capital will be able to offer reduced fees across the board. The firm will also offer private equity clients access to its banking relationships to secure personal loans, credit against the firm’s balance sheet or to finance carry payments.

“As interest rates move into negative territory – and we do believe this will happen – firms will be forced to focus on the cash on their balance sheets,” said Paul Fletcher, a partner at London & Capital and formerly marketing and communications head at private equity firm Duke Street.

The firm will not be the first to prioritize either speciality lending or tailored wealth management services to private equity general partners.

Specialist bank Investec has an established fund finance team serving funds, general partners, individuals and limited partners, while London-headquartered Partners Capital, established in 2002, was established in 2001 to allow general partners at leading investment management firms to “outsource portfolio management of own family endowments”. The firm has now expanded to manage capital for a number of institutional clients, including 11 Oxford and Cambridge University colleges.