|
Situation:
The GP is out of carried interest on a particular fund.
As a result, the GP does not get compensated for the value creation for the rest of the fund life, which creates a misalignment of interests between the GP and their LPs.
Solution:
Through a structured secondary transaction, a new carried interest mechanism is replicated, renegotiating high water mark of the carried, and therefore, re-incentivizing the GP, and recreating an alignment of interests with LPs.
