Flowstream Royalties Limited (FSR) has published a prospectus (see below) in relation to an IPO that is targeting a capital raise of up to US$250m (with a minimum of US$100m) to invest in royalties and streams on assets related to the upstream oil and gas industry, and associated infrastructure.
Once the Company is fully invested, it intends to have not less than 85 per cent. of its gross assets held in the form of Royalties and Streams, with the remainder being held in the form of other Investments. The assets are expected to be principally located in jurisdictions that are members of the OECD, the G20 (excl. Russia), Malaysia and Singapore.
The prospectus says that, once the net proceeds of the IPO are fully invested, FSR will target a quarterly dividend of around 7% per annum on the initial issue price. FSR will seek to grow this to 8%, over time, subject to it achieving significant portfolio diversification.
FSR has a tiered base management fee structure.
- 1 per cent. of the NAV up to, and including, US$500 million;
- 0.75 per cent. of the NAV in excess of US$500 million and up to and including US$1 billion; and
- 0.50 per cent. of the NAV in excess of US$1 billion,
The manager can also earn a performance fee of 10% of the outperformance above an 8% per annum hurdle, subject to a high watermark.
FSR is permitted to borrow up to 50% of its NAV at the time of drawdown, although board permission is required where this is above 35% of NAV.
https://quoteddata.com/wp-content/uploads/2019/08/20190801-FSR-Prospectus.pdf
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