BGF is reporting a strong outlook for 2021. Throughout the last six months, the investment team for Scotland has invested close to GBP33 million across 10 Scottish growth businesses, including a cornerstone investment which marked BGF’s second investment in a Scottish IPO in 12 months.
BGF is a long-term patient investor, making initial investments between GBP1 million to GBP15 million for a minority equity stake. It backs ambitious teams across a range of sectors and funds a variety of growth plans.
Patrick Graham, head of Central Scotland and Northern Ireland at BGF, says: “Despite ongoing disruptions caused by the Covid-19 pandemic, we’ve been extremely busy in the first half of the year. The team has invested nearly GBP33 million across a range of very different companies, from early-stage technology to ecommerce and to the healthcare sector – proof of continued, strong demand for capital among ambitious businesses in the region.
“Although there remains a significant level of uncertainty in the market, we are very optimistic about the outlook for growth businesses, with a high level of confidence in the management teams running the great companies in our portfolio.”
In June, BGF invested GBP7 million in The Artisanal Spirits Company limited (ASC), specialist retailer of premium single cask, single malt Scotch whisky and other spirits, as part of its admissions to trading on AIM.
The funds raised through the IPO, which achieved a valuation of around GBP78 million, along with the company’s existing cash resources, will allow Edinburgh headquartered ASC to develop its membership base, enhance its digital channels, grow internationally and bring new brands to market.
The deal follows BGF’s investment in Calnex Solutions plc as part of the Linlithgow-based provider of test and measurement solutions for the global telecommunications sector’s IPO in September 2020.
BGF investments in Central Scotland include: GBP4 million into social care provider CSN Care Group; GBP5.2 million in Odro, a Glasgow business that makes video interviewing and engagement software for recruiters; GBP5 million in Fife-headquartered natural pet food producer Bella & Duke; and part of a $4 million investment round in Edinburgh-based Desana, a flexible hybrid workspace platform for global employers.
Many of BGF’s existing portfolio companies in Central Scotland are also celebrating growth in H1 of 2021.
Following a GBP2.7 million investment from BGF in 2020, Stirling based paint and accessory retailer The Paint Shed opened its eighteenth store in Aberdeen in May.
Walker Precision, the Glasgow based specialist engineering firm achieved Nadcap Gold status, joining a select few organisations to be awarded this highest accreditation – Nadcap is a global program designed to set standards for aerospace engineering, defence and other related industries.
Belfast based window blinds manufacturer Mzuri Group completed the acquisition of TCMM Shutter Group in February, increasing the company’s headcount to 1,227.
BGF’s GBP2 million investment in Country Antrim’s coffee & food shop chain Bob & Berts supported the firm’s expansion into England, with new stores now open in Lancaster and Kendal, and further sites planned for Preston, Perth and Dundee.
BGF expects to see continued demand for business funding in the latter half of 2021 as management teams assess their options.
Graham adds: “Business may seek minority equity funding for a variety of reasons, for instance to develop products, expand overseas, or to provide fuel to continue growing prior to a full exit. BGF can provide funding for these reasons and many more, always as a minority, non-controlling shareholder.
“Although there are likely to be challenges ahead as government support, such as the furlough scheme, begins to taper, we are confident that the future is bright for ambitious, well-managed growing businesses and we are more than happy to have conversations with teams looking to expand and grow.”
