Subject: Re: Update
From: "Arlene Busch" <[email-masked]>
To: "Jim Gordon" <[email-masked]>
Date: Sat, 28 Jun 2014 09:18:57 +0900

Friday June 27th:
Tokio Marine
Takao Yamakoshi
Tokio Marine started investing in Private Equity in 1997. In 2002 they
started their own PE FOFs. Currently they have two services: they
manage a proprietary FOFs and they also do advisory work on behalf of
their parent company (60%) and outside clients (40% ). They currently
have 1BL in PE and their ticket size is between $5ML and $20ML.
Tokio Marine works with Pathway (Irvine Cal.) to help them source PE
firms and make recommendations. Do you know Pathway?  Takao was
interested and I said I would send him the prospectus once marketing
commences.

Sumitomo Mitsui Trust
Shuichi Kiyanagi, Hiroki Iwai, Nobuhiro Sato
SMT is the "eight hundred pound gorilla" in Japan. They have $200BL in
AUM. We met with both the client side and the proprietary side. On the
prop side, they make 10 investments (6 in the US) each year and are
actively looking for middle market PE funds in the US. On the client
side, their investments are opportunistic. Their typical ticket size
is $10 ML (prop) and $50ML (client side). They asked for our
presentation to be emailed to them in English so they can send it to
their HK. Office. They would like to visit Edgewater in the next four
months.

Gilbraltar
Ippei Wakui, Atsuko Sakai,
They only invest in the mega funds and have no plans to invest in
middle market. No interest.

Sumitomo Mitsui Banking Corp
Takayuki Kawabata, Chiaki Matsushita
SMBC is a completely separate entity, making their own investment
decisions. SMBC started investing in PE in 2005. They currently have
100 PE funds (most mega funds) and have been disappointed with their
overall returns. They are only a team of 6 people and do their own due
diligence on sight. Their typical ticket size is $20ML to $50ML. Being
a bank, they are very concerned about the outcome of the Volker Rule
and how it might affect their ongoing investment thesis. They are
actively looking for middle market PE firms and currently have two
slots open for new investments. They were very interested, but need to
figure out the Volker Rule (3 to 4 months) prior to proceeding.

Conclusion:
The consensus thought is that the mega funds are paying too much for
their companies. Edgewater's 4.9x resonated well. Everyone thinks
interest rates will be rising in the coming years. Everyone was
impressed with the Advisory Group and Partners. Most of the groups I
spoke with were actively looking for middle market PE investments.
I believe we have a few solid leads:
KIC because of my personal relationship with Hyunsu Oh.
Samsung
Nomura Private Equity because they currently have middle market money
available and are actively looking for PE firms.
Tokio Marine (challenge will be to get in front of Pathway)
Sumitomo Mitsui Trust
Sumitomo Mitsui Banking Corp (challenge will be for them to overcome
the Volker Rule

Jim,
I look forward to speaking with you next week,
Arlene

>
> Thursday June 26th: (Wednesday was a travel day from Seoul to Tokyo)
> Normura Private Equity Capital Co.
> Kazoo Nishimura and Aya Torii
> NPEC is a consultant "gatekeeper" to financial institutions including
> life insurance companies and banks. NPEC has its own PE FOFs focused
> on middle market Asian PE funds. They consult on the US  middle market
> industry. Their typical ticket size is $10ML to $30ML. When I was
> discussing the low debt levels as one of the selling points of
> Edgewater, Aya asked "how much money is currently available for middle
> market PE funds?" Jim, maybe you can give me your thoughts on this
> question.
>
> Alternative Investment Cpaital
> Tepee Kawai and Hiroaki Gi
> AIC is a consultant " gatekeeper" to their shareholders. The
> shareholders are: Mitsubishi Corp (51%), Daido Life Insurance Co.
> (25%), Sumitomo Mitsui Banking Co. (20%).
> As with NPEC, AIC has a few PE FOFs for their shareholders and offers
> them along with they advisory services. They were very interested in
> receiving written performance information. I told them I would contact
> them once I was able to send them the information (I presume this is
> once official marketing commences).
>
>>
>> Tuesday June 24th:
>> Dongbu Insurance
>> James DH Lee and Jang Huh
>> Another large insurance company. Dongbu specializes in casualty
>> insurance rather than life insurance. They are currently invested in
>> private equity, but only the very large funds. James was pretty honest
>> about the difficulty they have in investing in smaller managers in any
>> asset class since they don't have the manpower to due overseas due
>> diligence.
>> James asked two questions I thought were good:
>> How much money will the GP commit to Fund IIII?
>> How did you meet the members of Edgewater's Advisory Board?
>>
>> KYOBO Life Insurance
>> Dongmo Matt Lee
>> A large life insurance company. They are just starting to look at
>> smaller funds since they have been disappointed with the larger funds.
>> Their typical ticket size is $30ML to $50 ML. They work with a bond
>> manager in Chicago PPMA and will be in Chicago sometime early next
>> year. I am hopeful they will visit Edgewater then.
>>
>> SAMSUNG Life Insurance
>> Jaehan Moon
>> Samsung is the 300lb gorilla in the room. They invest in smaller
>> managers and are actively looking for next year. Their typical ticket
>> size is $30 ML. Jaehan was very impressed with the Advisory Board and
>> partners. They have an office in NY and suggested he send an
>> introductory email to the NY office so we can visit them. Jaehan wants
>> to wait until Edgewater is ready to start marketing. Jaehan said their
>> due diligence process takes two to three months.
>> Jaehan had one question:
>> He questioned your years in the industry at 39, suggesting your age
>> and the issue of succession. Jim, we can discuss, but you might want
>> to change it to 30 years experience to alleviate this issue going
>> forward.
>>
>> My thoughts: we have two solid leads from this trip to Korea: KIC and
>> Samsung. If either one of the groups invests, all of the others will
>> follow.
>>
>> Best,
>> Arlene
>>
>>>
>>> Monday June 23rd:
>>> KIC: Korean Investment Corporation
>>> Hyunsu Oh and Yujung Kim
>>> The meeting went well. I had a nice time catching-up with Hyunsu ( I
>>> will see him and his wife for dinner tomorrow evening). KIC is Korea's
>>> largest investment vehicle for alternatives. They currently have a
>>> portfolio of 2BL in Private Equity. Hyunsu believes the portfolio will
>>> increase to 4BL next year. They are now starting to look beyond the
>>> big names in the sector. Their minimum investment is $100ML per fund,
>>> but they will create a PE FOFs to write smaller tickets between $20ML
>>> and $50 ML. KIC will be in the US and in Chicago in the fall. Hyunsu
>>> will be on the trip as KIC teams one investment member with one
>>> research member. KIC will be in Chicago to visits Citadel (which has
>>> an allocation from them). I have suggested KIC spends time with
>>> Edgewater while they are in Chicago.
>>>
>>> Shinhan Life Insurance Company
>>> HeeSong Kim and Jun-Hyung Shin
>>> Shinhan is one of the Big Five Insurance companies in Korea. They plan
>>> to start allocating to Private Equity next year. I can't tell yet
>>> whether they will only look at the big names or invest across
>>> different fund sizes. Ken will follow up with them.
>>>
>>> Hanwah Life
>>> Kevin Hur
>>> Hanwah is one of the Big Five Insurance companies in Korea. They only
>>> started investing in alternatives in 2012. I believe they are not a
>>> good candidate for an investment at this time. Ken will follow-up with
>>> them.
>>>
>>> Mirae Asset Life Insurance
>>> Seon-Kyoung Choi and Younju Lee
>>> Mirae is one of the Big Five Insurance companies in Korea. Currently
>>> they invest in Real Estate (own the Four Seasons Hotel in Sydney among
>>> many other properties) and fixed income. They haven't started to look
>>> at Private Equity yet, but they realize they will need to start
>>> investing in alternatives soon. Not a good candidate for investment.
>>> Ken will follow-up with them.
>>>
>>> Best,
>>> Arlene
>>>
>>>
>>>
>>> Arlene Busch
>>> 312-498-9595 (m)
>>> 202-333-1880 (w)
>>>
>>>
>>>
>>>> On Jun 23, 2014, at 8:17 AM, Arlene Busch <[email-masked]> wrote:
>>>>
>>>> Arrived in Seoul with no delays or issues. Waiting for Ken Lee to pick
>>>> me up. Presentations arrived fine. Will let you know how the meetings
>>>> went at the end of my day. Having dinner this evening with Ken
>>>>
>>>> Arlene
>>>>
>>>> Arlene Busch
>>>> 312-498-9595 (m)
>>>> 202-333-1880 (w)
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