Investment, Wealth Manager Incubator Sings Malta's Praises

Tom Burroughes

30 January 2012

Sturgeon Ventures, a firm that acts as an incubator to investment and wealth management businesses, has set up three of its fund manager clients in Malta, a jurisdiction it sees as set to attract an increasing number of start-up financial companies.

The clients are hedge fund Tertius European Absolute Return; Clerkenwell Capital, manager of the Clerkenwell Matterhorn Fund, a professional investor fund that invests in listed European real estate securities; and Sarum Partners, a private equity fund manager.

Tertius Capital and Sarum are now both domiciled in Malta while Clerkenwell Capital’s application is currently being processed by the Malta Financial Services Authority, Sturgeon said in a statement.

The Mediterranean island, which is now in the European Union and a member of the eurozone but without some of the debt problems affecting other members of the bloc, also has benefits of low costs and efficient regulations, Seonaid Mackenzie, Managing Partner at Sturgeon Ventures said.

The decision to use Malta as a domicile is an example of how international financial jurisdictions are battling to compete for fund business by offering new structures, tax and regulatory incentives. In Malta's case - an independent state that was a former UK colony since the late 18th Century - the country has insisted it can no longer be described as an offshore centre, citing its EU membership status. This is a critical issue at a time when the EU has recently passed legislation regulating such vehicles as hedge funds, private equity and other "alternative" funds, stoking fears that non-EU jurisdictions could be placed at a competitive disadvantage.

To view a feature that this publication produced on Malta as a financial centre, click here.

Tthe number of funds located in Malta has now grown to 500 with a net asset value of €8 billion (around $10.7 billion) from 165 funds with less than €5 billion in NAV in 2006. Six fund management companies have re-domiciled to Malta since 2009 (source: MFSA).

“After frequent reconnaissance trips we are so well established in Malta that we can provide clients with an invaluable bank of local contacts and knowledge both in and outside of financial services, offering little extras such as local drivers, hotels and recruitment firms as well as lawyers and accountants,” Mackenzie said.

To view an interview with Mackenzie about Sturgeon, click here.