Kleinwort Benson has been appointed fund administrator to a Guernsey domiciled fund with a launch value of USD150m.

Kleinwort Benson (Channel Islands) Fund Services has helped Prosperity Capital Management to launch its fourth Guernsey domiciled closed-ended fund, Prosperity Quest II Unlisted.

Prosperity has been investing in Russia and the CIS since 1996, with a long-only, activist philosophy. With approximately USD4bn of assets under management, it is the largest independent portfolio manager of international monies in the region.

The investment strategy of the Prosperity Quest II fund is to invest in small and medium Russian companies, acquiring significant minority stakes and increasing the value of the underlying companies through shareholder activism.

Prosperity has accepted subscriptions in specie, with underlying assets such as companies, not simply monetary subscriptions. This has amounted to approximately 20 per cent of the subscriptions.

“We are still in a very difficult market for fund raising, particularly for investing in Russia and other emerging markets,” says Joe Truelove, head of Channel Islands business development for corporate clients at Kleinwort Benson. “The fact that Prosperity Capital Management has managed to raise USD150m for a new fund in the current environment is a testament to their strong reputation and expertise in the Russian market. Adapting the subscription to allow investors to invest in specie was a particularly innovative solution.”

Kleinwort Benson administers three other Guernsey domiciled funds for Prosperity, all closed-ended vehicles.

“We are pleased to have attracted new investors in this challenging environment, and to have worked with Kleinwort Benson in Guernsey on this successful fund raising,” says Liam Halligan, chief economist for Prosperity Capital Management.