Kristina Laasma

Recommendations

LP Advisory Committee LPAC and the Role It Plays

In this article we will explain the role of the LP Advisory Committee (LPAC).

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Transparency to LPs

In this article we will try to understand what general conduct issues should the GP consider with regard to LP relations.

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Timing of Fund Distributions

In this article you will find the recommendations when should fund distributions be made. We remind you that we provide professional services for alternative funds opening and supporting at best rates in Estonia.

Recommendations

Should a Cash Exit Always be Sought?

Explanation A GP’s obligation is to seek the best returns from an investment for the fund and the GP must consider opportunities to effect non-cash disposals in light of this. It may be that, for example, there is no cash purchaser for an investment, or that a cash price

Recommendations

Should Guarantees and Indemnities be Given on Exit?

Explanation A purchaser of a portfolio company may seek a range of warranties and indemnities from the fund. Negotiation over these will invariably be a key issue for the GP when disposing of an investment. During negotiations, the GP must consider the risks and detriment to the fund in giving

Recommendations

When Should The Sale of Investment Take Place?

Explanation Determining the right time to sell an investment is a judgement call for GP. Any decision to dispose of an investment involves a comparison of the current value of an investment, its potential future value and the opportunities to realise that value in the future. In making this consideration,

Steps To Be Taken When Investment Doesn't Meet the Goals Set Forth in the Business Plan

Explanation Unfortunately, not all investments are successful, and while it may not be possible to salvage an investment in a portfolio company with an underlying structural problem, it may be possible to turn around a poor performance record or preserve the value of an investment by * Meeting with the portfolio

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Skills Needed by GP-appointed Director to be a Board Member

Explanation Many skills are applicable to become a board member. In particular, the company may need directors with industry experience, legal, corporate finance or accounting experience, or general management experience relevant to the company and/or the sector and region in which it operates. All of these skills, plus the

Recommendations

How Many Supervisory Board Mandates Should a Person Accept?

Explanation Someone with a good track record as a director may find themselves invited to serve on multiple boards. This may result in the person having limited time to fully perform their duties. Recommendation A director should accept only as many directorships as he or she can reasonably be expected

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Is a Diversity Policy Really Necessary?

Explanation Boards function as decision-making and review forums involving people with differing skills and approaches. Diversity of skills and styles leads to better balanced and informed decision-making. Recommendation In reviewing board composition, the board should be aware of the benefit of diversity in its selection as well as any applicable

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Key Components of the Portfolio Company's Strategy That are the Responsibility of the Board

Explanation A portfolio company's strategy consists of a number of core components that are the responsibility of the board. First and foremost is the development of long-term value creation through current and future revenue streams. The most important value corresponds to existance of such terms as effective and

The Board’s Role in Relation to the Identification, Assessment and Management of the Risks and Opportunities of the Portfolio Company

Explanation A key element of a portfolio company’s business strategy execution is the identification and assessment of risk and opportunity, including decisions on what levels of risk are acceptable, what risks are associated with each opportunity, how such risks can be mitigated and controlled and how to manage the

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Environmental Factors GP Should Take Into Account in Relation to the Management of the Fund's Portfolio Companies

Explanation In general, GPs should support a prudent and sustainable approach to environmental risks and opportunities that may affect their portfolio companies. Such risks could relate to a range of factors including resource use/consumption, water scarcity, waste production and disposal; emissions in air, land and water; energy use, carbon

Recommendations

Monitoring of Investment Made by the Fund

Explanation In most jurisdictions, there are legal obligations regarding the information that must be provided to stakeholders of portfolio companies. However, it is common practice for funds investing in portfolio companies to request more frequent and detailed information than is required by law. In particular, GP may require more frequent

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The Issues to be Considered by GP in Relation to Co-investments and Parallel Investments by LP Co-investors and Other Third Parties

Explanation In certain circumstances, LP co-investors of the fund or other third parties with whom GP is in some way connected may wish to invest directly in a company in which GP proposes to invest on behalf of the fund. If a co-investment is more successful than the fund as

Recommendations

How GP Ensures It Is Able to Influence a Portfolio Company on Behalf of the Fund

Explanation There are a number of different ways in which GP can ensure that the fund can influence a portfolio company. Which is appropriate will depend on a number of factors (including the size of the Fund's investment and the degree of influence that GP considers appropriate). If