Octopus Investments, part of Octopus Group, has announced a GBP10 million over allotment facility for its current AIM VCTs fundraise.
Octopus has rapidly reached the initial GBP20 million target within just seven weeks and is now offering a further GBP10 million of fundraising capacity to meet investor demand.
The VCTs have existing portfolios of around 75 companies which have been built over a number of years and aim to provide investors with long-term growth as well as income through their established dividend policies. They offer investors access to a wide range of AIM listed growth companies across a diverse range of sectors, from building materials and pharmaceuticals to software development and restaurants.
One example of a successful company backed by Octopus AIM VCTs is Gear4Music, which has grown to become the UK’s leading ecommerce retailer for musical instruments and equipment. Its management has built an impressive and increasingly international operation, with new distribution centres recently opened in Sweden and Germany.
Paul Latham (pictured), Managing Director at Octopus Investments, says: “Summer has historically been a slower fundraising period but in the last few years we’ve noticed that financial advisers and investors are starting their financial planning much earlier. This is the fastest we’ve ever raised GBP20 million for our AIM VCTs, which certainly indicates an acceleration in that trend.
“Demand continues to be driven largely by the reduction in the pensions’ lifetime allowance and changes to the tax regime for buy-to-let, with an increasing number of investors looking for tax efficient alternatives to complement their retirement plans.”
Richard Power, Head of Smaller Companies at Octopus Investments, says: “AIM is now home to a growing number of household names and is seen as the go to market for ambitious growth companies. In addition to the compelling long-term investment opportunity, UK smaller companies play a huge role in driving economic growth and many investors are keen to play a part in that.”
The new share offer for AIM VCT and AIM VCT 2 is open until 5 April 2019 for the 2018/2019 tax year and 2 August 2019 for the 2019/2020 tax year. The offer will close earlier if it becomes fully subscribed. Investors have the option to split their investment 60/40 between AIM VCT and AIM VCT 2, or to place 100 per cent of their investment into either VCT. The minimum investment is GBP5,000.
