Brummer

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(No Transcript)
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Brummer Partners and its business model
Viveka Ekberg Radisson SAS Scandinavia
Hotel March 18, 2004
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Quick summary
Chairman Patrik Brummer Managing director
Klaus Jäntti
Strategy L/S global equity Market neutral L/S
European equity Managed futures Inception July
1, 1996 January 1, 1998 October 15, 1999 May 1,
2000 AUM (Feb/04) SEK 10,953m SEK 8,810m EUR
285m SEK 1,758m Strategy L/S Nordic equity
L/S TMT equity Global macro Global
quant Multistrategy Inception December 14, 2000
January 1, 2001 October 1, 2003 February 1,
2004 April 1, 2002


October 1, 2002
AUM (Feb/04) EUR 147m SEK 662m SEK
518m EUR 8m SEK 2,266m EUR 21m

• Privately owned hedge fund manager Total
  assets under management USD 3.6bn
• Offices in Sweden, Finland, Norway and USA
  Total no. of clients Approximately 6,000
• Approximately 115 employees Offshore
  vehicles since July, 2003
• - 70 people in eight investment teams
• - 45 people in supporting infrastructure

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History

• 1995 Brummer Partners founded
• 1996 Launch of long/short global equity fund
  Zenit
• 1997 Divestment of Brummer Partners corporate
  finance department
• 1998 Launch of market neutral fund Nektar
• Acquisition of the Nektar Funds fund
  management company

1999 Launch of venture capital company Zodiak
(currently in run-off) Launch of long/short
European equity fund Futuris (run in partnership
with PMs) 2000 Launch of global futures fund
Lynx (run in partnership with PMs since
2002) Launch of long/short Nordic equity fund
Avenir (run in partnership with
PMs) 2001 Infrastructure company, BP Fund
Services, formed Launch of long/short global
technology fund Manticore (run in partnership
with PMs) 2002 Launch of multistrategy funds
Helios and Helios Euro 2003 Launch of
non-dividend paying fund Nektar (Bermuda)
Launch of global macro fund Latitude (run in
partnership with PMs) and non-dividend paying
fund Latitude (Bermuda) 2004 Launch of global
quantitative fixed income and currency fund Arcos
(run in partnership with PMs) Launch of
non-dividend paying fund Lynx (Bermuda)
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Corporate strategy

• Our goal
• Create a diversified and sustainable hedge fund
  business

• Key success factor
• Align business model with individual aspirations
• Attract and retain highly motivated investment
  professionals
• Equity stakes for key people
• Financial incentives to succeed financial
  consequences of failure (entrepreneurial
  incentive structure)
• Separation of portfolio management and business
  management
• Strong industry skills and economies of scale in
  supporting infrastructure

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Infrastructure

• No. of employees
• 45 people
• Supervision
• Finansinspektionen (Swedish Financial Supervisory
  Authority)

Chairman Klaus JänttiManaging director Hans
Ulinder
SalesViveka Ekberg, Gustaf Elmstedt
Compliance Erika Lundquist
Operations Hans Ulinder
Legal Caroline Mitteregger
Systems Henrik Johansson
Reception Secretariat
Systems Development
Client Services
Back-office
Finance/Control
IT-support
Middle-office
Custodian SEB (multiple responsibilities) Audito
rs Appointed individually
(multiple responsibilities) Supervision Local
authorities in Sweden and
Finland See appendix
NAV-calculation B P Fund Services Risk
measurement B P Fund Services Risk control
and compliance B P Fund Services
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Going forward

• Establish Brummer Partners as a leading hedge
  fund group
• Our business model leads to continuous pressure
  on growth and development
• Conservative, long-term approach to
• New assets under management
• New funds
• Internationalisation of client base
• Attractive track-record
• Robust infrastructure
• Large and stable domestic client base
• Broad skill-set across many hedge fund strategies
• Offshore vehicles

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Appendix
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Distribution of responsibilities

• The fund management company and the fiduciary
  custodian shall operate indepedently of each
  other and exclusively in the common interest of
  the unit-holders.
• Mutual Funds Act (19901114) (1)
• The fund management company
• has responsibility for the management and
  day-to-day administration of the fund,
• represents the unit-holders in all financial and
  legal matters pertaining to the fund
• The fiduciary custodian
• accepts the funds assets and holds them in
  safe-keeping,
• handles all payments to and disbursements by the
  fund,
• settles the funds securities transactions,
• has responsibility for ensuring that
  subscriptions and redemptions of units, and
  calculations of the value of units, take place in
  accordance with the law and the applicable fund
  rules,
• has responsibility for ensuring that the funds
  assets are used in accordance with the law and
  the applicable fund rules

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Distribution of responsibilities (contd)

• The auditors
• control the securities transaction flow,
• control the subscription and redemption
  procedures,
• check the calculation of the fixed management
  fee, the hurdle rate, and the performance-based
  fee,
• verify the funds balance sheet (net asset
  value),
• examine other internal processes,
• review and audit the fund management company and
  the fund
• Finansinspektionen (Swedish Financial Supervisory
  Authority)
• grants licences to engage in fund management
  activities,
• supervises Swedish fund management companies,
  securities companies, mutual funds and fiduciary
  custodians,
• appoints auditors to review and audit fund
  management companies and mutual funds
• Each fund management company has two mutually
  independent auditors. These are elected by the
  fund management companys annual general meeting
  and statutorily appointed by Finansinspektionen
  (Sweden) or appointed by the unit-holders
  (Finland).
• A government authority.

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Taxation

• No tax at source on capital gains in Sweden and
  Finland
• Tax at source on dividends in Sweden
• L/S equity funds à non-dividend paying funds
• L/S fixed income and futures funds à
  dividend-paying funds
• Offshore investors should use Bermuda-based
  vehicles
• No tax at source on non-dividend paying (growth)
  units in Finland
• Finland-based funds offer both dividend-paying
  and non-dividend paying units.

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Legal structure
Chairman Patrik BrummerManaging director Klaus
Jäntti
(100)
(100)
Chairman Per JosefssonManaging director
Douglas Cliggott
Chairman Klaus JänttiManaging director Hans
Ulinder
Brummer Partnersownership in eachcompany is
markedwithin brackets Helios is available in
both SEK and EUR
Zenit Asset Management AB (100) Chairman Per
JosefssonManaging director Klaus Jäntti
Nektar Asset Management AB (100) Chairman Kent
JanérManaging director Klaus Jäntti
B P Asset Management (Bermuda) Ltd (100)
Chairman Klaus Jäntti
Nektar (Bermuda) Ltd. Latitude Fund (Bermuda)
Ltd.
Manticore Capital AB (45)Chairman Jonas
FredrikssonManaging director Ola Björkmo
Avenir Fondbolag AB (30)Chairman Klaus Jäntti
Managing director Peter Ramsay
Futuris Asset Management AB (53)Chairman Knut
BrundtlandManaging director Marie Friman
Arcos Fondbolag AB (40)Chairman Klaus
JänttiMan. director Risto Peltokangas
Latitude AssetManagement AB (45) Chairman
Klaus JänttiManaging director Jens Berglund
Lynx Asset Management AB (40)Chairman Klaus
JänttiMan. director Svante Bergström
January 2003