July 2014
www.wealthandfinance-intl.com
Wealth
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US Tax Law
A hammer blow for the nation’s economy?
We’re Older and Wealthier (for Now)
Earnings have increased since the 1970s – but our savings have steadily fallen
Tech Sales Aren’t Rocket Science
...but the sector is losing out because the basics aren’t being followed
THE Plus...
We bring you the latest news from the luxury sector
SUPER
RICH How much do we really know about them?
July 2014 | Contents
3 4-9 News & Appointments Funds 10 Unlisted Infrastructure Funds: A Record Number in the Market
There are a record 149 infrastructure funds in market as of the start of Q3 2014, new research shows.
Wealth Corner 12 We’re Older and Wealthier (for Now) Earnings and living standards have been increasing since 1975, our savings rates and retirement provision have been falling steadily backwards.
14 Who Are the Super-Rich? A new report shows that we don’t know as much about ultra wealthy people as we may think...
Banking Zone 18 Valuing a Close Connection A new ING study examines the strength of the financial link between Eastern and Western Europe.
Markets Matters 20 Tech Sales: Communication is Key Sales Commando’s Doug Tucker says the tech sector is losing out on sales because simple rules are being ignored.
Editor’s comment Hello again and welcome to July’s packed issue of Wealth & Finance. This month we hear from Tom McPhail from Hargreaves Lansdown, who points out that while earnings and living standards have been increasing since 1975, our savings rates and retirement provision have been falling steadily backwards... and warns that further down the line this is likely to lead to a failure to meet retirement income needs (p.12). Doug Tucker of Sales Commando is on hand to warn us that the tech sector is losing revenue due to poor sales techniques – and tell us how such losses can be avoided (p.20). Our cover story (p.14) busts a few myths about the super-wealthy (and reveals that they don’t all fly by private jet and own a US$10m superyacht).
Risk Management 24 War is a Great Distraction ...when it comes to the stock markets, says investment manager Rob Jones, partner at Adaws Capital.
Taxing Times 26 Global Tax Law: A Hammer Blow for the US Economy? Washington’s new legislation is potentially a ticking time bomb, says deVere Group’s Nigel Green.
Finance Focus 28 M&A Deal Values: Less than Meets the Eye? The pace of deal activity has slowed recently, says S&P Capital IQ.
30 Boom and Bust Global tech M&As thriving as fears of second dot.com bubble are making IPOs plunge, says advisory network BDO.
Relax 34 Relax News The latest updates from the worlds of luxury shopping, travel, dining and motoring. 38
A World Away
On page 18 we look at a new ING study that examines the strength of the economic link between Eastern and Western Europe, and what benefits have resulted from the connection. And, of course, there’s our luxury lifestyle section, Relax. This month, as well as bringing you the latest luxury consumer news (p.34) we’ve taken a look at the stunning Woodman Estate hotel on Southern Australia’s Mornington Peninsula (p.38). Plus there’s our regular round-up of the news and views affecting the major regions and markets from around the world. I hope you enjoy the issue! Mark Toon Editor
Escape to a bygone age at the luxurious Woodman Estate on the Mornigton Peninsula, South Australia.
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News & Appointments | July 2014
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News in brief Preferred Bidder Chosen for Anfield Expansion Carillion has been selected as the preferred bidder to expand Liverpool Football Club’s main stand and the associated public realm improvements. Work on the project is expected to start later in 2014, subject to planning consent. It is expected to take approximately 20 months to complete and the construction costs are likely to be in the region of £75m. If planning permission is granted, the proposals would see the capacity of a new main stand rise by approximately 8,300, taking the overall capacity of Anfield to around 54,000.
Techniwood Raises ¤5m to Accelerate Growth
PE Fundraising on Course for Best Year Post-Crisis Private equity funds globally raise US$190bn in first half of 2014 Private equity funds have raised US$190bn in the first six months of 2014, setting them on course to match, if not exceed, 2013’s performance in terms of capital collected. In 2013, funds globally pooled some US$420bn across the year, the highest figure since fundraising was hit by the financial crisis in 2008, according to PEI, which provides news, data and conferences for the global alternative asset classes of private equity, private debt, real estate and infrastructure. Historically, more funds close in the second half of any given year, and with some still to announce H1 closings, it looks highly likely 2014 will be the strongest fundraising year for the asset class since 2008. Other highlights: • •
The largest fund closed in H1 was AXA Secondary Fund VI, collecting US$9bn Funds looking for buyout opportunities remain most popular, collecting US$94bn.
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However, venture capital fundraising is looking strong Successful fundraising was largely driven by North-American focused funds – US$78bn was collected by firms looking for investment opportunities in the region.
Dan Gunner, director of research and analytics at PEI, said: “At the midway point of 2014, we are witnessing a private equity fundraising world in good health, in most parts of the world. We are particularly seeing Asia-focused private equity picking up again, and investors keen on opportunities in Africa. “Another significant trend has been towards investors seeking greater control over their investments and so a higher proportion of money going to co-investment opportunities. With the second half of any year often stronger than the first, and with more funds set to reveal they’ve closed already in 2014, we can confidently predict that 2014 will outstrip any year post-crisis in terms of capital raising.”
Techniwood Group has raised ¤5m from Electranova Capital, the cleantech investment fund managed by Idinvest Partners in partnership with EDF, one of the world’s largest utility companies. The capital raised will be used to support the growth of Techniwood’s industrial business, both in France and internationally. Techniwood is a widely recognised player within the sustainable building sector in France. François Pelissier, chairman of Techniwood Group, said: “This funding will enable us to continue the adventure we started in 2010. We see it as a validation of the vision and the solutions we pioneered in the field of industrial pre-fabricated materials. We continue to address the market for sustainable construction and renovation using exclusively organically-sourced materials”.
£20m Investment in New Buses for Glasgow 2014 First Bus has announced an investment of £20m in 109 brand new vehicles which will carry customers for the first time at the Glasgow 2014 Commonwealth Games. The new buses, which are currently being delivered, will form part of a 380 fleet that will move members of the Games Family, including athletes, officials, media and sponsors, and in addition operate specific shuttle and park & ride spectator services during the Games. These services, operated by First Bus, will augment First Glasgow’s network of high frequency, regular services across the city.
Outsourcing Highest in Telecoms, But Media Shows Greatest Growth New report reveals trends among largest companies in 27 industries Telecommunications remains the leading global industry for outsourcing, but the media sector saw the greatest growth in outsourcing activity in the last year, new research from Information Services Group (ISG), a leading technology insights, market intelligence and advisory services company, has found. Media outsourcing spending by annual contract value (ACV) rose US$478m, or 26%, in 2013, placing it well ahead of spending growth in the hotels, restaurants and leisure sector, where ACV rose by US$155m, or 53%. Telecommunications remains the undisputed champion of outsourcing, with ACV of US$21.6bn, the largest number of contract awards (104), the highest average total contract value (US$15.5m), the highest percentage of companies that outsource (82%), and the highest average company spend by ACV (US$393m) in the last year. Yet, the industry saw its ACV drop by US$862m, or 4%, in 2013, second only to software and services (down US$927m or 47%) among industries that saw the largest declines in ACV. “Media companies are expanding the scope of their activity beyond ITO and are now using outsourcing to support their strategic repositioning in response to the digital disruption in the industry,” said ISG Chief Research Officer Paul Reynolds. “Growth in the hotels, restaurants
and leisure vertical is coming from a small base and is motivated by the desire to increase speed of innovation. In contrast, telecommunications services remains one of the most sophisticated and mature markets, and much of the outsourcing activity there involves network sharing and support agreements among telecommunications providers themselves.” There were equal amounts of volatility (double-digit ACV swings in 11 of the 27 industries) and stability (12 of the 27 industries saw ACV changes of 5% or less) in outsourcing activity in the last year. Overall, losers (those with declining ACV) outpaced winners (those with increasing ACV) by a margin of 2 to 1, with an overall average decline in ACV of 4% among the 27 industries studied. Spending was subdued in most verticals as clients took advantage of intense service provider competition and cheaper cloud computing and X-as-a-Service (for example software as a service, infrastructure as a service, business process as a service, etc) offerings to reduce their service delivery costs. While it was challenging for service providers to grow ACV in most verticals, outsourcing penetration overall continued to rise. Currently, 45% of the world’s largest public companies have an active outsourcing contract, up from 40% in 2010.
Appointments Perella Weinberg Hires Advisory Partner Perella Weinberg Partners has announced that Jorma Ollila, former chairman and chief executive officer of Nokia and current chairman of the board of directors of Royal Dutch Shell Plc and Outokumpu Oyj, has been named an advisory partner of the firm. In this role, Ollila will provide senior counsel to the firm and its clients, particularly in Europe, utilising his vast business experience. Joseph Perella, chairman and chief executive officer of Perella Weinberg Partners, said: “Jorma is a well-respected executive and he represents everything we prize in a senior advisor. He offers invaluable international business perspective and insight that will be beneficial to both the firm and our clients. We are very fortunate to have him as an advisory partner and we are delighted that he’s on our team.” Ollila said: “Perella Weinberg Partners is a financial services enterprise of the future. I look forward to helping build on the firm’s past success advising clients around the world and providing a diverse platform of alternative asset management strategies.”
Insightful Hire by UK Asset Managers Insight Investment, one of the UK’s leading institutional asset managers, has appointed Svein Floden as head of business development for liquid alternatives in the Americas. Based in New York, he will report to Philip Anker, global head of distribution at Insight. Floden will join Insight’s business development team and will be responsible for developing products and implementing a distribution plan for Insight’s liquid alternatives, total return and absolute return products across the Americas. Floden joins Insight from Deutsche Bank Asset and Wealth Management where he has spent the past 14 years, most recently as head of hedge fund sales and marketing for wealth management Americas and director of institutional alternatives distribution, Latin America. Prior to Deutsche Bank, Floden was a member of the Latin America group at Citigroup’s private bank in New York. Philip Anker, global head of distribution, Insight Investment, said: “Svein’s wide-ranging experience in building and expanding hedge fund platforms and in distributing alternative investment products in this region will enable him to play a broad and strategic role in the development of Insight in the Americas.”
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News & Appointments | July 2014
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Brits Are Unwilling to Give up Life’s Luxuries, Even When Times Are Hard People are potentially spending thousands of pounds a year on non-essentials like eating in restaurants, going out and alcohol – and they’ve got no plans to stop Brits are reluctant to give up their little – and large – luxuries, new research from Nationwide Building Society reveals.
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People are potentially spending thousands of pounds a year on non-essentials like eating in restaurants, going out and alcohol. But for those who spend on these items, if they needed to save money, one in five (21%) said they would not be happy to cut back on any of their discretionary spending, while just 3% would forgo their holidays and only 4% would stop going to the gym.
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The survey totted up the ten most popular indulgences and then asked those respondents who said they spend money on each of these indulgences whether they would be willing to give them up to save money. Nationwide found:
More than half of those surveyed said they eat out in restaurants in an average month (56%), while more than four in ten (44%) enjoy going out to the cinema, pub or theatre. New clothes were the third most popular pastime, with 43% maintaining fashion was their achilles heel, while 41% spend their money on technology - from apps and computer games to mobile phone bills, laptops and internet. Cigarettes and alcohol ranked fifth for the most popular guilty pleasure, at 38% - the same as those who play the lottery or gamble each month.
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Only 3% would consider abandoning their holiday Just 4% would stop going to the gym 7% would give up non-essential transport such as taxis 8% would give up spending on technology(apps, phones, laptops etc.)
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17% said they would stop smoking or drinking alcohol Around a fifth (19%) would give up buying new clothes and accessories 19% would give up snacks, drinks and shopbought lunches during the working day 19% would give up going out (cinema, pub and so on) A fifth (20%) would put a hold on playing the lottery or gambling One in five (21%) would not give up any luxuries Nearly a third (30%) would give up eating out
Appointments New Appointment Is a Safe Bet for William Hill The Board of William Hill PLC has announced the appointment of James Henderson to their board as CEO designate with immediate effect. Henderson said: “My immediate priorities are to sit down with the team and discuss what the future looks like for William Hill, both from an organic point of view, building on the fantastic foundations we’ve got, but also looking at what opportunities might present themselves over the next two or three years.” He will take over as chief executive from Ralph Topping who will stand down at the end of the month after 44 years with the group and six as chief executive.
Adrienne Robinson Flying High at Precision Aviation Group Atlanta, USA-based Precision Aviation Group (PAG), a leading provider of products and value-added services to the worldwide aerospace and defence industries, has named Adrienne Robinson vice president, business development. Prior to her new appointment, Robinson served PAG in dual roles. She joined the company as vice president, business development in 2012 and three months later was asked to take on the additional role of president, precision aviation services (PAS) in Peachtree City, Georgia. During her leadership of PAS, Robinson negotiated an agreement with Airbus Helicopters Inc (AHI) designating PAS as an AHI service centre, the first in the Atlanta market. Under her guidance, PAS also became a dealer and a service centre for the Robinson Helicopter Co, one of the most trusted names in rotorcraft.
Sweet Smell of Success for Lance Patterson Cradle Holdings Ltd, which includes the luxury fragrance companies Penhaligon’s, which is based in London, UK and L’Artisan Parfumeur, which is based in Paris and Grasse, France, has announced the appointment of Lance Patterson as its CEO and to its board of directors. Patterson has over 22 years of retail expertise building luxury brands, including most recently as co-president of Peter Thomas Roth Clinical Skincare. Prior to his tenure at PTR, Patterson served as a senior executive at Bare Escentuals and several LVMH cosmetic divisions.
| Wealth & Finance | July 2014
Severe Thunderstorms in June Caused Nearly US$3bn Economic Loss in Europe
Outbreak of severe thunderstorms affected Western and Central Europe, causing significant hail damage in parts of Germany, France and Belgium The latest edition of Impact Forecasting’s monthly Global Catastrophe Recap report reveals that an outbreak of severe thunderstorms affected Western and Central Europe during the first half of June, causing significant hail damage in parts of Germany, France and Belgium, and killing at least six people in Germany.
development of models to help insurers more accurately evaluate their exposures. With exponential advances in computing power, model developers will gradually be able to address the challenge of modelling this natural hazard at the high spatial resolution required to make the results meaningful.”
The French Federation of Insurance Companies noted that 363,000 residential, automobile and business claims had been filed in France alone as a result of the severe weather, with insurance payouts forecast at ¤900m (US$1.25bn).
The US endured several rounds of convective weather during June, with tornadoes, hail and damaging winds leading to aggregate economic losses expected to reach the multi-billions of dollars, with insurance losses well exceeding the US$1bn threshold.
Overall economic losses from the event across Central Europe were listed in excess of ¤2bn (US$2.75bn). The losses marked the second consecutive summer in which parts of Europe have endured major insured losses as a result of hail; in 2013, insurers paid more than US$4bn in claims from hailstorms, mostly in Germany and France. Adam Podlaha, head of Impact Forecasting, which is the catastrophe model development centre of excellence at Aon Benfield, a division of Aon Plc, the reinsurance intermediary and full-service capital advisor, said: “For the second year running, hail-inducing thunderstorms have caused significant damage during the summer months in Europe. Given the recent level of losses for this peril, both in Europe and in the US, there is an increasing opportunity for the
The greatest impact was felt during a near-weeklong event that led to significant hail, straight-line wind, and flash flood damage across parts of the Midwest, Plains, Rockies, Southwest, and the Tennessee Valley, killing three people. Softball-sized hail and winds gusting beyond 90 mph (150 kph) led to economic damages totalling approximately US$850m, with insured losses in excess of US$550m. At least five EF-4 tornadoes touched down in the Plains during a 36-hour stretch, four occurring in northeast Nebraska, devastating the small town of Pilger. Elsewhere during the month, monsoonal rains caused significant damage in China, killing dozens of people and resulting in economic losses of more than US$2.0bn. The Ministry of
Civil Affairs (MCA) noted that nearly 200,000 homes were damaged or destroyed by flood inundation. Flooding rains occurred in southern Brazil, Paraguay and Argentina, killing at least 15 people. More than 500,000 people were directly affected or evacuated from their homes as several main rivers overflowed their banks. Preliminary damage estimates to residential property and infrastructure in Argentina alone were listed in excess of ARS500 million (US$62 million). Torrential rains and severe thunderstorms killed at least 15 people in northeast Bulgaria, resulting in residential and infrastructure damages of more than BGN55 million (US$38 million). Tropical storm Hagibis made landfall in southern China’s Guangdong Province with 50mph (80kph) winds. No serious injuries or fatalities were reported as the storm damaged roughly 1,000 homes, with economic losses listed at CNY814m (US$131m). Tropical storm Boris made landfall in near the border of southern Mexico’s Chiapas and Oaxaca states as a minimal 65mph (40kph) system after first spreading heavy rains into Guatemala. At least six people were killed as widespread flooding and landslides were reported in each country. Hundreds of homes were damaged.
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News & Appointments | July 2014
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Who Are America’s Wealthiest Living Entrepreneurs? Bill Gates claims top spot in new Wealth-X list, which is dominated by technopreneurs Wealth-X, the ultra high net worth (UHNW) intelligence and prospecting firm, has compiled a list of the top 10 richest living self-made American entrepreneurs. The 10 entrepreneurs on the list are collectively worth US$407.4bn, accounting for about 20% of total UHNW wealth in America. UHNW individuals are defined as those with net assets of US$30m and above. Cumulatively, the market capitalisation of these 10 individuals’ primary companies is US$1.7tn, which means they have created wealth four times what they are worth themselves. Bill Gates tops the list with an estimated net worth of US$80.2bn. Gates dropped out of Harvard in 1975 and, together with his childhood friend, Paul Allen, founded Microsoft and served as CEO until 2000. He now has a limited role in the company as chairman and technology adviser, and is focused on global philanthropic work through the Bill and Melinda Gates Foundation. Six out of the 10 billionaires made their fortunes from technology or
technology-related businesses, including Gates, Larry Ellison of Oracle and Facebook co-founder Mark Zuckerberg, who is the youngest individual on the list. The oldest person on the list is legendary investor Warren Buffett. Below are the top five wealthiest self-made Americans: Rank 1 2 3 4 5
Age
Bill Gates Warren Buffett
58
Technology
83
Diversified Investments
64.2
69
Technology
48.2
Larry Ellison Michael Bloomberg Sheldon Adelson
Where They Made Their Fortunes
Net Worth (US$bn) 80.2
Name
72
Media
33.7
80
Hospitality, Casino and Gaming
32.8
All of the self-made entrepreneurs on the list are active in the world of philanthropy, and six of them have joined the Giving Pledge, a campaign initiated by Gates and Buffet to encourage the world’s most affluent individuals to pledge at least half of their fortunes to charity.
Cyber Attacks a Growing Concern for UK Organisations Research reveals that 41% of organisations globally were hit by Distributed Denial of Service (DDoS) attacks over the past year Disruptive cyber-attacks are becoming more effective at breaching security defences, causing major disruption and even bringing down systems for whole working days, according to a new global study from BT. The research reveals that 41% of organisations globally were hit by Distributed Denial of Service (DDoS) attacks over the past year, with more than three quarters of those (78%) targeted twice or more in the year. DDoS attacks are seen as a key concern by more than a third of UK organisations (36%). Globally the worry is even greater, with almost twice as many organisations naming the attacks a key concern (58%). The new study explores the attitudes to and preparedness for DDoS attacks of IT managers from organisations in eleven countries and regions around the world. It reveals that despite the growing concern over the attacks, only about half of UK organisations (49%) have a response plan in place. Less than one in 10 UK decision makers (eight%) strongly believe they have sufficient resources in place to counteract an attack. DDoS attacks can cause major disruption for organisations; they can take down an organisation’s website, overwhelm a datacentre or generally cause networks to grind to a halt and become unusable. They are also increasingly becoming more complex and difficult for organisations to fend off. Nearly two thirds (59%) of those polled agree that DDoS attacks are becoming more effective at subverting their organisation’s IT security measures. Attackers are often adopting hybrid, or multi-vector, attack tactics which involve attacks through multiple platforms. These have increased by two fifths (41%) during the past year. Multi-vector attacks pose increased complexity and risk as they involve multiple attack methods deployed simultaneously. These often require a dedicated mitigation team to track and combat the threat across multiple fronts, as automated systems are less likely to be able to offer adequate protection. Mark Hughes, president of BT Security, said: “DDoS attacks have evolved significantly in the last few years and are now a legitimate business concern. They can have a damaging effect on revenues and send an organisation into full crisis mode. Reputations, revenue and customer confidence are on the line following a DDoS attack, not to mention the upfront time and cost that it takes an organisation to recover following an attack. Finance, e-commerce companies and retailers in particular suffer when their websites or businesses are targeted. “Organisations need a higher level security solution to protect not only the network infrastructure but the devices that initially provide protection.”
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Wealth & Finance | July 2014 |
Funds | Unlisted Infrastructure Funds
Unlisted Infrastructure Funds | Funds
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Unlisted Infrastructure Funds:
A Record Number in the Market Alongside a record 149 unlisted infrastructure funds in market, only 10 infrastructure funds held a final close in H1 2014, a drop from the 24 that closed in H1 2013, according to research and consultancy firm Preqin
However, funds closed in H1 2014 have raised US$17.5bn, US$1bn more than the US$16.5bn raised in H1 2013, demonstrating that while fewer infrastructure funds are closing, a significant amount of capital is still being raised by larger funds. Funds closed in H1 2014 also spent less time in market, an average of 13.4 months, significantly less than the average of 21.6 months spent in market by funds closed in 2013. Other Key Facts on the Infrastructure Industry in Q2 2014: •
89% of unlisted infrastructure funds closed in H1 2014 met or surpassed their fundraising goals, compared to only 42% of funds closed in 2013. 67% of funds closed in H1 2014 raised 125% or more of their target sizes.
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The largest fund that closed in Q2 2014 was EnCap Flatrock Midstream Fund III,
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which held a final close on $3bn and is managed by EnCap Flatrock Midstream; the fund is targeting infrastructure opportunities in the US. •
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Although unlisted infrastructure funds in market targeting $1bn or more only represent 25% of funds currently on the road by number, they are looking to raise 59% of the capital being targeted. Overall, 46% of unlisted infrastructure funds currently in market have held an interim close, raising an aggregate $43bn towards their fundraising targets.
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While just a small number of infrastructure funds have closed in H1 2014, many that have closed have been very large offerings
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Preqin’s latest research shows that there are a record 149 infrastructure funds in market as of the start of Q3 2014, targeting an aggregate $90bn. However, the number of funds holding final closes has declined in 2014 so far compared to last year; just 10 infrastructure funds have closed in 2014 to date, only 42% of the number of funds closed in H1 2013.
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Deutsche Asset & Wealth Management is raising the largest infrastructure fund currently in market Pan-European Infrastructure Fund II, which is looking to raise €2bn and is looking to invest in opportunities in Europe.
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96 infrastructure deals were completed in Q2 2014, a drop compared to the 155 completed in Q1 2014.
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The energy industry sector saw the most infrastructure deals in the quarter, with 47% of all deals in Q2 2014 in this industry; this was followed by transport, which saw 22% of all deals.
“While just a small number of infrastructure funds have closed in H1 2014, many that have closed have been very large offerings,” says Andrew Moylan, head of real assets products at Preqin. “This shows that larger, and often more established, managers are collecting the lion’s share of institutional investor capital. With a record number of funds in market, smaller or emerging fund managers will likely find it difficult to attract investor capital in the coming months and will need a compelling investment strategy they can effectively articulate to potential investors in order to be successful.”
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Wealth Corner | We’re Older and Wealthier (for Now)
We’re Older and Wealthier (for Now) | Wealth Corner
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We’re Older and Wealthier
(For Now)
Tom McPhail, head of pensions research at financial service company Hargreaves Lansdown, warns that while earnings and living standards have been increasing since 1975, our savings rates and retirement provision have been falling steadily backwards We’re much better off than we were in 1975, and each successive cohort has been better off. Employees aged 21 in 1995 earned 40% more by age 39 (in real terms) than those aged 21 in 1975 did by age 39. This may come as a surprise to the twentysomethings of today who are struggling to buy a house, however it is also notable that the one major blip in this upward rise in prosperity has occurred since 2009 when real earnings peaked. Average earnings are down by around 11% since then. It is also interesting to note that since 2011, the largest wage falls have been experienced by the top 10% of earners. A further sign of growing equality is the narrowing of the earnings gap between men and women, which is now close to zero up to age 30, though it then grows to 45% at age 49. Peak earnings now occur for those aged 38, on average, compared to age 29 in 1975. This makes sense in terms of increased participation in tertiary education but also validates the shift towards later retirement too; the whole adult life journey from education to earning, saving, retiring and spending has shifted further out along the age scale. I spoke to a 20 year old hairdresser yesterday, who was shocked to learn that she’ll not get a state pension until she is nigh on 70; we’ve still got a job to do in shifting people’s expectations to fit the new reality. It is striking that whilst earnings and living standards are increasing, our savings rates and retirement provision have been falling steadily backwards. Average pension contributions to defined contribution pensions are still below 10% compared to the 16% to 20% which was being paid into final salary schemes up until a few years ago. Older generations earned less, saved more and lived shorter lives; today we earn more, save less and will live for longer; further down the line this is likely to lead to a very substantial failure to meet retirement income needs. It is vital that the next government looks at what can be done to build on auto-enrolment and further increase pension participation and savings rates. | Wealth & Finance | July 2014
Wealth & Finance | July 2014 |
Wealth Corner | Who Are the Super Rich?
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Who Are the
A new report shows that we don’t know as much about ultra wealthy people as we may think...
They all inherit their wealth, attend Ivy League universities, own superyachts or private jets and always emerge unscathed from the impact of economic cycles. These are some of the common myths about the super-rich debunked by Wealth-X, the ultra high net worth (UHNW) intelligence and prospecting firm, in a new report. The report shows that only 19% of the global UHNW population fully inherited their wealth. However, 65% made their wealth themselves and a further 16% inherited and grew their fortune through their own entrepreneurial endeavours. It also shows that UHNW individuals – defined as those with assets of at least US$30m – who inherited their wealth have a lower average net worth (US$130m) than their entrepreneurial peers who made their fortunes (US$142m). The report also reveals that only a small fraction of the global UHNW population possess a high enough net worth to afford a 30-metre superyacht,
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which has an average price tag of US$10m (before maintenance, fuel and other expenses). Due to the high cost of owning and maintaining a private jet or superyacht, many UHNW individuals charter these luxury crafts or travel on commercial airlines – albeit in first or business class. Below are eight common myths about the ultra wealthy: • • • • • • • •
The world’s wealthiest inherited all their money The majority of super wealthy are investment bankers “Technopreneurs are all hoodie-wearing college dropouts in their 20s” “I have to go to an Ivy League University to be an UHNW individual” The wealthy are immune to economic cycles Chinese UHNW population is growing faster than everyone else The wealthy don’t give back UHNW individuals all fly by private jet and own a superyacht
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The report reveals that only a small fraction of the global UHNW population possess a high enough net worth to afford a 30-metre superyacht, which has an average price tag of US$10m
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$uper-Rich? Globally, there were 199,235 individuals in 2013, with a combined wealth of US$27.7tn, according to the Wealth-X and UBS World Ultra Wealth Report.
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Tax |
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Banking Zone | Valuing a Close Connection
Valuing a Close Connection | Banking Zone
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Eastern and Western Europe:
Valuing a Close Connection
ING’s new study is the first time the connection is measured by including trade flows, bank loans and foreign direct investments. It is also the first time the economic impact both regions have on each other is measured and how this translates into production and employment. The study illustrates that since 1995, demand from CEE and Russia for products and services from Western Europe has added US$240bn value to Western European GDP and created almost 2.7 million jobs. In the same period demand from Western Europe added US$272bn to GDP of CEE plus Russia and created 1 million jobs in CEE while Russia lost 0.5 million jobs.
This strong economic connection between the regions resulted in huge benefits leading to growth in employment and GDP.
ING seeks to answer the question: “What has been the contribution to economic prosperity that the relationship between Western Europe and Central and Eastern Europe plus the Commonwealth of Independent States (CIS) has helped to create over the past 25 years?” To identify the overall relationship ING has introduced the ING Connection Rate, which captures the values of trade flows, FDI stocks and bank loans expressed as a percentage of GDP.
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While both regions have shown a substantial increase in prosperity since 1995, GDP and GDP per capita has risen more rapidly in Central and Eastern Europe and CIS. This growth accelerated in 2004, partly because of the accession of 8 CEE countries to the EU. This process is linked to increasing bilateral trade flows, foreign direct investments and bank claims.
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The connection rate in Western Europe has steadily increased since the mid-1990s, despite the effects of the global financial crisis. It reached 20.6% of WE GDP in 2012. The connection rate by terms of CEE+CIS GDP increased to 82% of GDP in 2007, but has shown a decline since 2008 to 65% in 2012, due to the higher economic growth figures for the CEE+CIS region than in WE
Rob Ruhl, Head of Business Economics at ING, says, “By also taking into account foreign investments and bank loans, the connection between Western and Eastern Europe gives a picture of the real value of the overall economic relationship between these two regions. There is no other region with a stronger connection with Western Europe, except for Western Europe itself. The study shows the close connection has been of mutual benefit in terms of GDP growth and job creation.”
In Western Europe: •
•
•
The ING Connection Rate was equivalent to around 20% of Western European GDP in 2012. US$240bn has been added to GDP in Western Europe due to demand from CEE and Russia between 1995-2012. The main beneficiaries in US$ have been Germany, Italy, UK, France, Spain and the Netherlands. Almost 2.7 million jobs were created between 1995 and 2009, due to demand from CEE and Russia.
In CEE and Russia: •
•
•
In CEE and CIS, the ING Connection Rate was equivalent to 65% of their GDP in 2012. US$272bn has been added to GDP in CEE and Russia due to demand from Western Europe between 1995-2012. The main beneficiaries in US$ have been Russia, Poland, Turkey, Czech Rep., Hungary and Slovak Rep. CEE saw an increase of 1 million jobs between 1995-2009 due to increased demand from Western Europe. However, Russia lost some 0.5 million jobs in this period, which leaves the total job increase for CEE and RU at around 0.5 million.
A new ING study measures the strength of the connection and shows what major benefits have resulted from the economic relationship between Western and Central and Eastern Europe, Russia and the other countries of the Commonwealth of Independent States (CIS) over the last 25 years | Wealth & Finance | July 2014
Wealth & Finance | July 2014 |
Markets Matters | Tech Sales: Communication is Key
Tech Sales: Communication is Key | Markets Matters
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Tech Sales:
Communication is Key
The tech sector is losing potential sales because the simple rules are being ignored, says Doug Tucker, managing director of sales advisory consultancy Sales Commando There is new and ever more capable technology at our disposal but, as a leading sales training organisation warns, the first to miss the opportunities to bring this to the masses are often tech salespeople. Doug Tucker, managing director of Sales Commando believes that those at the front line of technology sales have all but forgotten the proven sales techniques that are the true drivers behind long-term product success. “Technology is developing at an unprecedented rate – in terms of R&D it is booming – and this should be great news for the consumer, tech firms and the economy. Yet my work within the sector highlights its salespeople typically simply list technical facts to potential clients and believe that that’s an effective sales method. Believe me, it isn’t.” As Doug points out, it’s now time for sales staff to go back and rediscover fundamental selling techniques if they want to make the most of new and emerging technology opportunities. He comments: “The odd thing I notice from a sales point of view is that technology is getting more complicated, rather than – as we’re led to believe – more simplified. “Consumers are becoming rabbits in headlights, trapped with the dazzle that is technology specification. It is the responsibility of technology salespeople to understand what a consumer wants, remove the dazzle and attend to that critical need, which surprisingly may not be the leading edge of technology.” Doug is adamant that proven sales techniques “aren’t rocket science” but need to be adhered to, and the first and most basic rule of thumb is the need to listen. As Doug says: “The easy way out of a difficult technology sales situation is by creating the magpie effect – whatever is shiniest and newest – backed up by a string of senseless jargonistic descriptions. But this, usually, only garners frustration and disillusionment amongst customers. “Great selling is all down to the ability to listen to the customer and being able to communicate effectively – every time. The technology sector is evolving rapidly and will, hopefully, introduce us to products that will change our lives for the better and forever. But for this to happen, tech firms need to learn how to bring their customers along with them, not alienate them at the first hurdle.” | Wealth & Finance | July 2014
About Doug Tucker... Ex-commando turned globally-renowned motivational guru Doug Tucker is managing director of sales advisory consultancy Sales Commando. Based on more than 20 years of top-level, impactful selling experience, Sales Commando offers corporate sales training to some of the world’s leading organisations. Through live group seminars and/or downloadable interactive videos and books, Sales Commando introduces a set of core sales principles and techniques to enable sales teams to convert leads into sales efficiently and effectively. Doug’s debut book, Sales Commando: Unleash Your Potential is now in its second edition.
Wealth & Finance | July 2014 |
Markets Matters | Investing in Paradise
Investing in Paradise | Markets Matters
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Calum Mckenzie, who has worked in the offshore financial services industry for over 14 years, tells us why the Idyllic British Virgin Islands offer much more than just sun, sea and sand.
Investing in virgin territory | Wealth & Finance | July 2014
The main factor that makes the British Virgin Islands an attractive investment/business destination would be confidentiality. The BVI is the leading jurisdiction for the incorporation of companies. The number of companies registered now will be approaching one million with approximately 500,000 being active. The single main reason for this is the product… the BVI company is quick and simple to obtain/register, easy to use and understand – thanks to pragmatic, clear and simple legislation, recognised worldwide and a historically proven product.
to change the landscape of mutual funds business in the BVI (aside from codifying certain requirements, which were previously imposed by the Financial Services Commission).However SIBA has created a regime for the licensing and operation of investment advisors, broker dealers, market makers and custodians where such activities were previously unregulated. SIBA also introduced a market abuse regime which provides protection for investors by criminalising insider trading, circulating misleading information and market manipulation.
It should also be noted that the service providers in the BVI are very competent. The jurisdiction itself has built its own reputation for the past 25 years and has proven it will do what is necessary to enable business to thrive within the BVI. In short, people can rely on the BVI.
As a BVI Fund is a regulated entity the establishment and use of such a licensed entity is, as one would assume, a more complicated, costly and time consuming process than establishing a simple BVI business company. However on a relative basis BVI mutual funds are a highly attractive product. The set-up procedure is efficient, quick and relatively low cost. There are no investment restrictions (aside from public funds) and returns are not subject to tax at corporate level. They can provide access to international markets and allow international investors access to locally managed assets and globally held investments.
The BVI has long been recognised as the go-to domicile for the incorporation of offshore companies. There is no question that this can be attributed in large part to the basic tenet of the jurisdiction being tax neutral, highly cost efficient and offering a good degree of privacy within which to conduct business affairs. The BVI has a highly-regarded legal system based on English common law and is home to the Commercial Court of the Eastern Caribbean Supreme Court, which provides unparalleled legal access to practitioners. The legal framework is modern yet proven and trusted with prudent modern regulations.There is a stable political climate, as the recent change in the governing party demonstrates and there is a dedicated network of high quality sophisticated corporate and financial service providers based in the region. It is home to the full array of global offshore law firms and also all of the ‘Big 4’ accounting and audit firms, along with a very good range of niche and boutique service providers. It is OECD ‘white listed’ and is a member of IOSCO (International Organisation of Securities Commissions).It has also recently undergone another review by the IMF and has in large part been given a glowing report. General living standards in the BVI are very high compared to most other Caribbean islands - and indeed compared to many other supposedly more sophisticated jurisdictions - and as a result of this the BVI has a very high GDP per capita. All of these factors have contributed to the success of the BVI and its core product of the BVI business company.
The key in this regard is to ensure that you choose the correct BVI service provider for your needs as not all BVI based service providers offer such value added services. In addition to the value added products available in the investment business sector, the BVI continues to be a popular domicile for insurance products most notably captive and re-insurance vehicles. However with the onset of more demanding and discerning clients, the BVI now has service providers who are able to facilitate clients’ demanding products such as high net worth life insurance and specialty products such as professional indemnity insurance and directors and officers insurance. These can be facilitated and provided through BVI-based specialty brokers with access to premier international insurers and the Lloyd’s market. Using a licensed broker based in the BVI that specialises in financial services ensures that you have someone who understands both the needs of the specific client, albeit a fund, private trust company or service provider, and the regulatory and legal obligations of BVI licensees.
The jurisdiction has for some time been seeking to add value to its core company product and has created a number of successful complimentary products and structures resulting in more sophisticated options for clients.
Having such providers available is another important development to the local industry, which in many other jurisdictions remains underserved by overseas brokers that do not fully understand the nuances and complexities of offshore financial services jurisdictions.
In the main, since the creation of the original BVI business company in 1984, BVI companies have been used by individuals for traditional purposes such as trading, holding, contracting or uses such as succession and wealth planning. For corporate users BVI business companies are the vehicle of choice for those wishing to establish subsidiaries to fulfill a wide range of corporate and group functions at low cost and great efficiency. Such uses would include special purpose vehicles for one-off transactions, joint ventures, or other more general operations such as treasury functions or to provide access to foreign capital markets. However, the maturation of the BVI as a jurisdiction means that the BVI is ideally placed to handle much more sophisticated types of business.
One area of business that is anticipated to grow significantly in the BVI is the provision of BVI-based independent directors who can implement and administer an appropriate good corporate governance structure.
The BVI is the number two domicile in the world by number of registered mutual funds. In order to bolster this segment of the industry the Securities & Investment Business Act (SIBA) was passed into law in 2010 and created a legislative and regulatory framework governing the entire investment business industry (as opposed to simply mutual funds as per the 1996 Mutual Funds Act). SIBA in itself has done little
In conclusion it can be said that the BVI is placing itself well in the competitive world of finance. It has demonstrated over an extended period of time its ability to meet the changing demands of its customers and yet simultaneously enhance its products and reputation. The BVI is an ideal place to do business and will continue to be the leading choice for the discerning needs of the global financial community.
Such a path of progression is inevitable on the back of the recent financial scandals and the ongoing economic crisis, both of which have led to a world of increasing compliance and a need for transparency. The professional and experienced service providers in the BVI are well placed to capitalise on this segment of the industry as an increasing and exciting opportunity.
Wealth & Finance | July 2014 |
Risk Management | War is a Great Distraction
War is a Great Distraction | Risk Management
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WAR
is a Great Distraction ...when it comes to the stock markets, says investment manager Rob Jones, partner at Adaws Capital
War makes people and nations do funny things, and not as in “ha ha” funny. Recently, the stock market in the US has drifted slightly positive, all while growing ever complacent and lacking in any real volatility. Federal Reserve chair Janet Yellen’s press conference on 18 June following the end of the US central bank’s monetary policy meeting merely replicated what Ben Bernanke said in years past: let’s “sort of” stay the course and, by the way, let’s project the future expectation of growth (all without giving any real examples of how). Now, this being said, it’s not to say that our government would quietly manufacture a war to stimulate the market, but don’t put it past them either. I’m not even connecting the Fed to this. I’m just saying we love a distraction. We have alliances in powerful people and places across the world, propping up governments and economies. Why are we chumming up with Iran at this point in our history, because of concerns over Iraq and the influence of ISIS? Why did we buddy with Iraq back in 1979, to support their war against Iran? We all know the answer and yet we act as if this sort of mongering isn’t done anymore. Simply, “we are past that part of our evolution as a nation.” | Wealth & Finance | July 2014
Them be lies, my friend. Evidence is growing in the latest war machine growth, concerning the Ukraine. Europe and our allies are in a bad spot concerning an increase of terrorism and its influence on the continent, coming from Iraq and Syria. The question if President Obama will send our soldiers to secure a safer Iraq is a point of concern today as the stock market drifts sideways.... just meandering away. Now, I’m not suggesting that all war or terrorist concerns are all under the control of the US government, or the Illuminati, or some other nebulous agency in a far off land, hidden in the deepest bunkers. I am saying that wars and skirmishes across the world are perfect distractions from other issues that should hold precedence. I do suggest questioning everything and keeping a mindful eye on the markets, your money and the future of your country. There is a lot at stake here, and it’s ramping up. Greed is driving the car. Wealth & Finance | July 2014 |
Taxing Times | Global Tax Law: A Hammer Blow for the US Economy?
Global Tax Law: A Hammer Blow for the US Economy? | Taxing Times
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Global Tax Law:
A Hammer Blow for the US Economy? New legislation is potentially a ticking time bomb, says Nigel Green, CEO of international financial consultancy deVere Group History will ultimately teach us that America’s far-reaching new global tax law is a “hammer blow for the US economy”, warns the founder and chief executive of one of the world’s largest independent financial advisory organisations. The stark warning from Nigel Green of deVere Group, which has US$10bn under advice and management, is in response to the Foreign Account Tax Compliance Act, better known as ‘FATCA’, which was implemented by Washington on 1 July.
“For these reasons, plus a host of others, I believe that history will ultimately teach us that FATCA is a hammer blow for American jobs and the broader US economy.”
“Potentially, FATCA is a ticking time bomb that threatens the long-term sustainable growth of America’s economy and its international economic standing. There are three primary reasons for this,” explains Green.
“As such, I will continue to voice my calls for this damaging tax act – which cannot possibly effectively achieve its purported aims of combatting tax evasion – to be definitively repealed,” adds Green.
“First, a considerable reduction in future foreign investment is now, I suspect, inevitable as sensible overseas investors will, not unreasonably, prefer to put their funds elsewhere due to the heavy penalties of not fully complying with FATCA’s preposterously onerous regulations.
“I will also continue to champion the legal and constitutional challenges being prepared by the likes of American super-lawyer Jim Bopp Jnr and the Alliance for the Defence of Canadian Sovereignty.”
“Second, further capital flight is a real and serious possibility due to the current investment climate characterised by suspicion. According to the Texas Bankers Association, US$500m had already ‘flown’ from the state’s banking system by the early part of this year as a direct result of the IRS rules.” | Wealth & Finance | July 2014
“And third, US businesses that operate internationally are now routinely rejected from foreign banks and other financial institutions. Having no access to non-US financial institutions in countries where they do business significantly reduces their competitiveness.
FATCA, part of the 2010 HIRE Act, now requires every single financial institution in the world to report all their American clients’ financial activities directly to the US Internal Revenue Service (IRS), or be issued with a 30% withholding tax.
Wealth & Finance | July 2014 |
Finance Focus | M&A Deal Values: Less than Meets the Eye?
M&A Deal Values: Less than Meets the Eye? | Finance Focus
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It is generally recognised that the environment for M&A activity has improved due in part to the combination of rising corporate cash balances, continual low interest rates, an ongoing rise in equity prices and the emergence of activist investors
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M&A Deal Values:
Less than Meets the Eye?
Richard J Peterson, director, Global Markets Intelligence, and Robert A Keiser, vice president, Global Markets Intelligence, at S&P Capital IQ, say although the current pace of deal activity is impressive, it is significantly less furious than in prior years...
By many measures, the pace of announced worldwide merger and acquisition (M&A) activity has been on the ascent. The number of worldwide transactions taking place in the first half of 2014 (26,703) is almost 10% higher than the year earlier first-half count (24,360). Further, the number of deals valued in excess of $1 billion climbed by over 70% from 262 in the first half of 2013 to 449 during the first six months of 2014. It is generally recognised that the environment for M&A activity has improved due in part to the combination of rising corporate cash balances, continual low interest rates, an ongoing rise in equity prices, and the emergence of activist investors. Yet, despite this upswing, a review of historic worldwide M&A deal values relative to the market capitalisation of the S&P 500, conducted by the global markets intelligence research arm of S&P Capital IQ, finds that the current deal climate is significantly below the levels experienced several years ago based on this metric. As presented in the table below, we extracted the annual values for announced worldwide M&A activity since 2000. Based upon this examination, the high-water mark was in 2007, when total announced deal value approached $3.78tn. At that time, a calculation of deal value relative to the year-end float-adjusted market capitalisation of the S&P 500 at yearend 2007 shows a figure of 29.35%. Moving forward, that value hovered near or above the 20% mark until falling to 19.47% in 2012, when worldwide announced M&A deal value totalled US$2.48tn, and the market capitalisation of the S&P 500 approached $11.4tn, according to S&P Cap-
| Wealth & Finance | July 2014
ital IQ data. Last year, that ratio of worldwide M&A deal value to S&P 500 market capitalisation sank to 16.04%, the lowest level of this metric since 2004 when it was 15.49%. In reviewing announced worldwide M&A deal value of $3.29tn over the past twelve months, we find that, when placed in context to the current S&P 500 market capitalisation, on a float-adjusted basis of over $17tn, we find a value of less than 19%. To that end, we find the current pace of deal activity impressive, but less furious than in prior years, when our variable of deal value to market capitalisation approached 30%.
Year
2000
Worldwide M&A activity (bil.US$)
S&P 500 market capitalisation (bil.US$)*
2,677.50
11,713.80
M&A activity relative to S&P market value (%)
22.86
2001
1,380.70
10,463.40
13.2
2002
1,034.80
8,107.40
12.76
2003
1,090.00
10,285.50
10.6
2004
1,748.20
11,288.60
15.49
2005
2,516.20
11,264.00
22.34
2006
3,242.80
12,729.10
2007
3,776.80
12,867.80
29.35
2008
2,341.00
7,851.90
29.81
2009
1,984.90
9,927.60
19.99
25.48
2010
2,368.20
11,429.80
20.72
2011
2,882.40
11,385.00
25.32
2012
2,480.60
12,742.40
19.47
2013
2,646.10
16,494.80
16.04
3,286.40
17,404.00
18.88
12-month trailing deal value
*Float-adjusted. M&A--Merger and acquisition. Source: S&P Capital IQ.
Wealth & Finance | July 2014 |
Finance Focus | Boom and Bust
| Finance Focus
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BOOM AND BUST
Global tech M&As are thriving as fears of second dot.com bubble are causing IPOs to plunge, says advisory network BDO
BDO’s inaugural TECHtalk report has uncovered the health of activity within the sector, revealing a tale of two halves. On the one hand, global economic positivity is resulting in buoyed confidence for tech entrepreneurs, with M&As reaching a 14 year high. On the other, fears of a second tech bubble combined with geopolitical instability have caused nervous investors to pull the plug on investments in tech IPOs. The global economic upturn resulted in a flurry of mergers and acquisitions in the first quarter of 2014. Closed technology-related transactions numbered 211 in Q1 2014, totalling more than US$54bn – the highest total value for an opening quarter since 2000. Transactions were up a staggering 55% year on year and 23% from the previous quarter, driven by the high volume of deals in North America. In particular, software M&As drove growth, with high profile acquisitions such as Facebook’s takeover of WhatsApp buoying confidence and setting the tone for the year to come. The focus on software, and the high number of North American companies involved, saw a high number of deals backed by venture capital funds rather than private equity. High-value IPOs masked investors’ fears.
| Wealth & Finance | July 2014
Despite initial indicators signalling a robust first quarter for global technology IPOs, fears of a second dot.com bubble and rising geopolitical instability in Ukraine stoked growing investor unease. At the turn of 2014 company valuations soared, with the average IPO up almost 25% from its offer price in spite of meagre revenues and yet to be proven business models. As with technology M&As, confidence remained high in software, with companies such as London-based King Digital Entertainment, maker of Candy Crush Saga, gripping investors’ attention and becoming the most talked about IPO since Twitter’s offering in November 2013. But the reality was not to live up to the hype. By the end of the quarter, all of the software stocks that launched in Q1 finished below their debuts. More worryingly still, the IPO pipeline has all but dried up with just four IPOs in play by mid-May. Commenting on the report findings, Julian Frost, global head of technology at BDO, says, “The global economy might be improving, but the deal outlook hasn’t been universally bright for tech companies. In fact, it’s almost been a case of boom and bust as far as M&A activity and IPO stocks are concerned, with M&A seeing a flurry of activity and IPO shares taking a nosedive. “For those companies looking to thrive in the tech sector, it’s never been more important seek the right advice, at the right time to ensure they are able to adapt quickly to the fast changing marketplace. Those that don’t risk getting left behind.”
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On the one hand, global economic positivity is resulting in buoyed confidence for tech entrepreneurs, with M&As reaching a 14-year high. On the other, fears of a second tech bubble combined with geopolitical instability have caused nervous investors to pull the plug on investments in tech IPOs
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A comprehensive new report from BDO has for the first time shed light on the scale of deal activity within the burgeoning global tech industry.
Wealth & Finance | July 2014 |
| Wealth & Finance | July 2014
Wealth & Finance | July 2014 |
Relax | News
News | Relax
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Relax News
Relax News in brief Sotheby’s June Wine Sale Totals US$1.7m
The latest in luxury travel, motoring, art, shopping and dining
The 21 June 2014 sale of finest and rarest Wines at Sotheby’s New York exceeded the high estimate to total US$1,724,493.75 (est. US$1.14/1.58m) with 99% of lots sold. The sale was marked by broad international participation with collectors from 14 countries driving the outstanding total. The sale was led by Château Pétrus from a private Northeast collection with cases of both the 1990 and 1989 vintages exceeding the estimate. In addition, a diverse range of great Burgundy performed strongly with a case of 1998 La Tâche selling for US$24,500 – well over the US$14/18,000 estimate.
Brooks Brothers Appoints New Creative Director
British Brand Takes on Swiss Watch Industry with in-House Movement Hertz to Offer New Jaguar F-TYPE Coupe in Key European Destinations
lined and convenient rental experience and we know that Hertz’s passionate motoring enthusiasts will revel in the way they connect with the F-TYPE from the moment they press the start button and the engine roars into life.”
Hire company has has rights to rental exclusivity in 2014 of the sports car in Spain, France, Belgium, Italy and The Netherlands
The F-TYPE Coupe was launched at the 2013 Los Angeles Auto Show before going on sale in Spring 2014 and combines pulse quickening performance with precise handling. The car provides everyday refinement alongside a luxurious feel; all powered by Jaguar’s 3.0 litre V6 340 supercharged engine.
The Hertz Corporation, the world’s leading general use car rental brand, has launched the universally acclaimed Jaguar F-TYPE Coupe as its Hero car of the Hertz Dream Collection in Europe. The F-TYPE Coupe is the most dynamically capable, performance-focused sports car that Jaguar has ever produced, and its Hertz Hero car status hallmarks a successful three-year partnership between the two companies to provide indulgent driving experiences to Hertz customers. Hertz has rights to rental exclusivity in 2014 of the Jaguar F-TYPE Coupe in Spain, France, Belgium, Italy and The Netherlands, which can be booked via www.hertz.com. Michel Taride, Group President, Hertz International, said: “We are very excited to unveil the
| Wealth & Finance | July 2014
Jaguar F-TYPE Coupe as the Hero car of the Hertz Dream Collection as part of our three year successful partnership with Jaguar Land Rover. We are also thrilled to provide Hertz customers with exclusive rental access to this iconic car this year so that they can experience first-hand, before others, the innovation, technology and style the Coupe oozes. It really is the opportunity to drive one of the world’s finest cars without owning it.” Bernard Kuhnt, Regional Director, Jaguar Land Rover Europe added: “Following the success of the Jaguar F-TYPE convertible’s launch with Hertz in 2013, we are delighted to again partner with Hertz and offer drivers the chance to rent the Jaguar F-TYPE Coupe. Hertz offers a stream-
The Jaguar F-TYPE Coupe will be available for hire from: • •
• • •
Belgium – Brussels Airport France – Riviera locations: Nice Airport, Nice downtown, Monaco, Saint-Tropez, Cannes as well as in Paris downtown and airport locations Charles de Gaulle and Paris Orly Airports Italy – Milan Malpensa, Rome Fiumicino, and Olbia Airports Netherlands – Amsterdam Schiphol Airport Spain – Madrid and Barcelona Airports
Christopher Ward’s Calibre SH21 is “probably the most significant watch industry development by a British brand in the past 50 years” British luxury watch brand Christopher Ward (London) has stunned the global US$23bn Swiss watch industry by announcing the creation of its own in-house movement – the engine of the watch – Calibre SH21. Chris Ward, eponymous co-founder of the brand, describes this as “probably the most significant watch industry development by a British brand in the past 50 years”. Now in its tenth year, Christopher Ward has pioneered a radical new business model as the world’s first pure online luxury watch brand, offering a unique blend of quality, value and service establishing a powerful global reputation among watch fans. Around 40% of the brand’s sales are overseas, the US being the single largest market, selling more mechanical watches than any other UKbased brand. Now, despite still being a relatively young and independent brand, the company has advanced to a whole new level with the launch of its own in-house movement – Calibre SH21.
Mike France, one of the three co-founders of the Christopher Ward brand, explains the significance of the launch of Calibre SH21: “Last year, the CEO of a major Swiss luxury watch brand heard rumours about SH21 and his – frankly, affronted – comment was “What gives you the licence to do that? “For me, that comment epitomises two hugely contrasting spirits at opposite ends of this industry; the entrenched conservatism of the established brands and the dynamism of Christopher Ward and other independents. “We give ourselves licence to do this. Ten years ago we launched the world’s first pure online business model for luxury watches; we created a new paradigm in blending supreme quality with unprecedented value that challenged the industry norm. Today, we are advancing to a new level of independence that strengthens the foundations of the business for future growth.”
Brooks Brothers, America’s longest established clothing brand, has announced that Zac Posen has been named creative director for its signature women’s collection and accessories. In his new role, Posen will direct the current Brooks Brothers design and merchant teams and will be responsible not only for the women’s collection but will also affect a variety of areas including brand development and presentation for the women’s label. “We are thrilled to have Zac join us as creative director of our women’s collection,” said Claudio Del Vecchio, Chairman and CEO of Brooks Brothers. “He is one of the most talented and influential American designers working today. As soon as we met, it was clear to us that he had a true understanding of our brand and its storied 196 year heritage as well as the creativity to modernise our offerings within the category.”
Big Easy Socialite’s Jewellery Goes Under Hammer A collection of fine jewellery from the estate of New Orleans socialite and philanthropist Mickey Easterling, who passed away in April, is set to hit the auction block at New Orleans Auction Galleries in their 26-27 July sale. A colourful figure in the New Orleans social scene for several decades, Easterling’s collection includes Rolex watches, a baroque South Sea pearl necklace finished with a diamond and platinum clasp, a fourteen-karat yellow gold and diamond ring featuring a central 10.67 carat light yellow diamond and a beautiful platinum and diamond ring featuring a central 4.27 carat European-cut diamond.
Wealth & Finance | July 2014 |
Relax | News
News | Relax
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Showcase of Luxury Design to Make Asian Debut Thomas Erber’s renowned Cabinet de Curiosités, which will include contributions from Paul Smith and Maison Kitsuné, will open in central Bangkok in November Renowned culture writer Thomas Erber’s renowned Cabinet de Curiosités makes its debut in the Asian region in 2014, at SIWILAI Concept Store in Bangkok, Thailand. The exhibition, which contains the finest pieces from well-known and prestigious contributors from the fields of fashion, design, high jewellery, art, photography and more from around the world, will open its doors on 20 November. In Renaissance Europe, cabinets of curiosities were encyclopaedic collections of objects whose categorical boundaries were yet to be defined. Erber’s yearly exhibition, which started in 2010 at fashion retailer colette in Paris, followed by events in London, Berlin and New York, evokes the
spirit of those bygone exhibitions, bringing together unusual or challenging works by artists and designers from diverse fields. Collaborating and exploring different fields, each guest makes a unique or very limited edition piece, aimed at enhancing the essence of his artistic work or brand. Featuring amongst this year’s guests at the Cabinet de Curiosités are renowned brands such as Paul Smith, Carpenters Gallery, Visvim and Atelier Ruby, who will showcase their unique designs. The permanent guests – Maison Kitsuné, Alexandre de Betak, James Heeley, Harumi Klossowska, Marquis de Montesquiou and many more – will also participate once more at this year’s exhibition.
Air Canada Maple Leaf Lounge opens at Heathrow T2 Lounge, availanle to eligible Air Canada and Star Alliance passengers, showcases contemporary Canadian design, artwork and the majestic natural beauty of Canada and includes a spa-inspired shower area Air Canada has officially opened its latest International Maple Leaf Lounge at London Heathrow Airport’s new Terminal 2, also known as The Queen’s Terminal, Departures Area 2B. Located at Star Alliance’s largest airport hub and Air Canada’s largest international station, Air Canada’s London Heathrow Maple Leaf Lounge is a serene, stylish oasis where eligible Air Canada and Star Alliance customers can rest, refuel or refresh before their flight in an inspiring, contemporary environment that is a celebration of Canadian design, artistry and craftsmanship. “We are delighted to welcome Air Canada and Star Alliance eligible customers to our new Maple Leaf Lounge at London Heathrow’s new Terminal 2,” said Craig Landry, vice president, marketing at a reception with invited guests to mark the official opening of the lounge. “Our newest International Maple Leaf Lounge was created as an extension of the overall travel ex-
| Wealth & Finance | July 2014
perience for our international business customers. Our Heathrow customers will enjoy a calm and inspiring environment in which to work or relax before their Air Canada or connecting Star Alliance flight. We are proud to showcase contemporary Canadian design, artwork and the majestic natural beauty of Canada in our Maple Leaf Lounges.” Designed by Bennett Lo Toronto’s award-winning firm dialogue 38 who also designed Air Canada’s Frankfurt Maple Leaf Lounge, Air Canada’s Heathrow 700-square-metre Maple Leaf Lounge is a home away from home prior to flight, featuring: •
•
A Quiet Zone comprising three reclining pods equipped with personal satellite-fed TV screens, USB ports and Sony noise-cancelling headsets Spa-inspired shower area featuring showers
•
• • •
• •
with large rain-shower heads, ambient music Business Centre equipped with individual flat-screen Dell PCs, colour laser printing and scanning Complimentary wireless high speed Internet access throughout A cooking station with chef to prepare meals upon request Tended bar with Molson Canadian beer on tap along with a large selection of wines, beer and spirits Bistro-style dining area offering a selection of hot and cold food items Showcasing Canadian art and products from 2Loons a Toronto based design and production house, laminated glass art walls from Accura Glass, Concord, Ontario and Cloud lamp by Frank Gehry among others
Eligible customers include Air Canada Altitude Super Elite 100K, Elite 75K and Elite 50K members, Star Alliance Gold members and customers travelling in Business Class, who have confirmed same-day travel on a departing Air Canada or Star Alliance flight. In 2014, Air Canada will operate up to 77 roundtrip flights each week between Canada and London Heathrow with non-stop flights to eight destinations across Canada: Vancouver, Edmonton, Calgary, Toronto, Ottawa, Montreal, Halifax and St. John’s.
Wealth & Finance | July 2014 |
Relax | A World Away
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A World Away | Relax
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A World Away | Wealth & Finance | July 2014
Woodman Estate Hotel, on the Mornington Peninsula, is only an hour away from southern Australia’s vibrant city of Melbourne, but offers a true escape to a bygone era of traditionWealth and& Finance elegance | July 2014 |
Relax | A World Away
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One of the most stunning landmarks on the Mornington Peninsula is Woodman Estate – a luxury country hotel with an acclaimed restaurant and a new spa retreat. The Woodman Estate’s beauty and serenity is easily accessible. Nestled within 50 acres of rolling pastures and lush fragrant bush land, the estate is set amid an extensive formal garden of box hedges, rose gardens, herbaceous borders and sweeping lawns to the lake’s edge. The hotel overlooks a breath-taking private lake that boasts its very own island. Woodman Estate offers all the elegance and tradition of a bygone era complete with all the comfort and convenience of the modern day. The estate is a majestic example of timeless style and brilliant design. This luxury accommodation has been lauded by both Australian and international guests. The estate features exquisite detail including ornate decorated cornices, ceiling roses, dado panelling, stained glass windows and antique fittings. The estate offers three different styles of suite for you to enjoy. You can indulge yourself and choose to stay in either individually-designed lodge or manor house suites and rooms or opt for the luxurious lakeside chalets. Three luxurious lakeside chalets are located right on the water’s edge. This penthouse style accommodation is the ultimate in luxury and elegance. Each chalet features a private lounge-cum-dining room with open fire, velvet sofa and cosy wingback chair and ottoman. The separate king sized bedroom has a handmade mahogany four-poster bed and shutters that open over the spa tub offering sweeping views of the lake from every aspect. Lakeside chalet packages start from AU$795 (£438) per couple per night. There are also three stylish and opulent spa suites overlooking the lake. Situated in both the lodge and the manor house, lake views are complemented by
| Wealth & Finance | July 2014
spa baths, sumptuous imported fabrics and a spacious king size bedroom. Packages in these suites start from AU$560 (£309) per couple per night. Four deluxe rooms overlook the surrounding gardens and pasture and bush land. Situated in both the lodge and manor house, these rooms provide the ideal place to enjoy the resort style facilities at Woodman Estate and the diversity of the Mornington Peninsula. Packages in these deluxe rooms start from AU$360 (£198) per couple per night. The estate’s spa is the perfect place to unwind, and there are some fascinating treatments available. The Kodo body massage is inspired by traditional Australian Aboriginal techniques which tone and realign energy flow, enhancing mind and body balance and wellness. A combination of pressure points and
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Woodman Estate offers all the tradition of a bygone era complete with all the comfort and convenience of the modern day
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he Mornington Peninsula is only an hour’s drive from Melbourne, but it seems a world away. Surrounded by Port Phillip to the west, Western Port to the east and Bass Strait to the south, and connected to the mainland in the north, the peninsula has an air that’s reminiscent of the Mediterranean, with numerous vineyards and olive groves.
spiralling movements ground and uplift, balancing the body’s energies. A choice of native aromatic oils are selected to address individual client needs - to rejuvenate, harmonise or detoxify. The Hot Rocks massage takes you to amazing new levels of relaxation through expert use of heated lava rocks gliding over and into your muscles, melting your tension away. And, while you’re feeling relaxed, why not add in the Paudi head treatment. This de-stressing massage focuses on the many pressure points of the scalp while your hair is nourished with a quandong hair mask. Dining at Woodman Estate provides many options. You can enjoy formal dining, the elegant à la carte
brasserie or the newly completed lakeside terrace. Gourmet food is the order of the day. The best in local and seasonal produce from the region is complemented by the Estate’s extensive herb gardens. Service levels are everything you’d expect of a five star establishment, with the estate’s cellar full to bursting with wines from the acclaimed wine making region of the Mornington Peninsula, other regions of Australia and overseas. A great way to spend a couple of hours is on one of the hotel’s mushroom foraging tours. Together with the Woodman’s lead forager Reade Smith, you’ll wander the estate and learn about all things fungi –and, most importantly, what to eat and what are deadly! The tour is followed by a two course light lunch and a glass of Woodman Estate wine at the Woodman’s Brasserie Restaurant (with mushrooms part of the dining fare, of course). There’s plenty to do if you want to get out and about. The Mornington Peninsula is easy to explore at a leisurely pace. You can travel the length of the peninsula’s coastlines, stopping at the numerous seaside villages, or just meander back and forth from one coast to the other on country roads with glorious views. Take a ferry to French Island from Western Port Bay, while from Sorrento there’s a vehicular ferry to Queenscliff and the Great Ocean Road. And remember, the vibrant city of Melbourne is just an hour’s drive away. Enjoy the colour and life of Victoria market, chic international designer boutiques, innovative and quirky high street shops, hidden gems in arcades and quality department stores. On Brunswick Street, enter the more eclectic realms of Melbourne fashion and see dance club gear, young designers, second hand shops and all that is retro, grunge and quirky. On Chapel Street and the suburb of Prahran indulge in playful clothing with an urban edge, while chilling out in bars, cafes and restaurants. In Melbourne, it’s hard to see the city for the trees. Magnificent gardens and parks abound. Check out the Royal Botanic Gardens and “the Tan” jogging track, or enjoy a stroll along the banks of the Yarra River. Dieting is a myth when you’re in Melbourne. Set yourself free and enjoy wonderful savoury and sweet taste sensations at the abundance of café’s, bars and restaurants.
Wealth & Finance | July 2014 |
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