First and foremost, we hope you and your families are doing well during these difficult times. We are convinced that communication and collaboration are of utmost importance in navigating through this unprecedented situation.
As a global firm, we have established a task force to continuously monitor the developments related to COVID-19 (Novel Coronavirus) closely. We are currently focusing on: (1) the safety of our investors, staff and partners, as well as (2) the continuity of our investment and business operations.
To ensure the safety of our investors and staff, we have installed several measures, including a global travel ban. Furthermore, we have aimed to minimize physical exposure and have asked the majority of staff to work from home until further notice. We are closely monitoring conditions in all office locations, and will maintain this new status quo based on appropriate levels of caution given current information at hand.
With the ability to conduct all business functions remotely, we are prepared to ensure the continuity of our investment and business activities in the current situation. Video conferencing and PC-based phone systems enable us to remain in close personal contact with our investors, partners, managers and representatives of portfolio companies, as well as our staff. Trade execution and portfolio monitoring is also conducted remotely by our team.
While it is too early to fully evaluate the impact on the economy, markets and our portfolios, we are actively engaging with our managers as well as CEO’s of portfolio companies in monitoring and assessing developments across portfolios. While we likely will not see the full impact on the global economy for a while, it is nonetheless becoming apparent that certain sectors – such as energy, travel, leisure – are particularly impacted, and contagion to other economic sectors has already been reflected in capital markets valuations. In light of such rapid developments and volatility, we should not expect our portfolios to be immune to a negative impact on valuation in the short term, nor until markets settle.
Against this backdrop, we are increasingly vigilant and careful in selecting any new investment opportunity and apply the required risk/return assessment reflective of market conditions, extreme volatility and uncertainty. We should nonetheless expect the pace of investment and exit activity to slow down.
The rapidly deteriorating confidence and market volatility is creating an increasingly uncertain and changing environment, and makes any prediction about the future particularly challenging. However, our investment philosophy has remained unchanged since 1998. Our approach of prudent investing with exceptional fund managers and in high-quality assets has benefitted our clients/investors throughout cycles.
These are unusual times, and we would like to reassure you that we are carefully monitoring the unfolding of events across the globe and acting promptly and accordingly. As with market corrections in the past, we believe that applying a long-term, cautious but opportunistic approach will eventually reveal attractive investment opportunities for patient and consistent investors.
Our main focus remains to fulfil the fiduciary responsibilities towards the capital entrusted to us by clients and by our shareholder. Therefore, we will remain in close dialogue with all of our investors and partners.
We would like to take this opportunity to thank you for your continued trust and we will continue to keep you informed about any future developments.
Please do not hesitate to contact us for further information.
LGT Capital Partners
Executive Management Team