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Unit holders find succor in the steady management fees that buyout firms charge on assets but have remained skeptical about the income linked to investment performance that differentiates private equity from traditional asset managers like T. Rowe Price.
People setting up trusts under the new regime will pay the 6percentnt charge and a 20percentnt charge on assets above the inheritance tax threshold (£285,000 as of 6 April), meaning very few will be created.
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EDF's net income declined by 68 per cent to €1.19bn from €3.7bn the year before after it took impairment charges on assets in the UK, US, Poland and Italy.
First, there was about $170 million of economic net income from management fees charged on assets in the 12 months to Sept. 30.
"But who wants to pay 1.5 and 20," percentage fees charged on assets and profits, "for a randomly selected portfolio representing a well-known asset class?
Other managers subsequently added a 2% annual charge on the assets they invested to arrive at the "2 and 20" formula that became the standard for both hedge funds and private equity.
Finally, there are Class C shares, with charges based on assets under management and the timing of redemption.
To administer the funds, Fidelity charges 0.6 percent on assets under $1 million, 0.45 percent on assets of $1 million or more and 0.19 percent for funds with more than $5 million in assets.
Clive Scott-Hopkins, financial adviser at Towry Law, says: 'The sweeping proposal to assess a former owner to a tax charge on an asset he has disposed of while continuing to enjoy the benefit will almost certainly curtail several "house schemes" where the Chancellor is expecting to reap huge death tax rewards.
Antonov's son Vladimir lives in London, used to own Portsmouth football club and is fighting attempts by Lithuania to extradite him on charges of asset-stripping.
Chairman Tim Martin said profits for the year to the end of July rose 8.4% to a record £72.4m on revenues up 11.7%, before exceptional items such as impairment charges on pub assets and an IT write-off.
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