The Danish Financial Supervisory Authority publishes guiding statement on alternative investment fund managers’ inclusion of leverage in unlisted companies and issuers
Published 19 December 2024
Category: AIFs
On 17 December 2024, the Danish Financial Supervisory Authority (Danish FSA) published a guiding statement regarding the inclusion of leverage by alternative investment fund managers (AIFMs) in unlisted companies and issuers.
The guiding statement refers to ESMA’s updated Q&A issued on 13 June 2023, in which the European Commission clarified how an AIFM should account for leverage present in unlisted companies and issuers controlled by an AIF when calculating assets under management.
According to the Danish FSA, the clarification implies that leverage must be included in the calculation regardless of whether it occurs within the AIF itself or in companies or issuers controlled by the AIF, provided that the AIF’s core investment strategy involves investing in assets through such entities. Furthermore, this interpretation means that the EUR 100 million threshold will apply in such cases.
The Danish FSA has indicated that this practice will be implemented going forward. AIFs registered before the publication date of the guiding statement will remain exempt unless they admit new investors and/or make new investments.
The full guiding statement (in Danish) can be accessed here.