Albion Ventures is launching a GBP25m share issue for Albion Development VCT through a new issue of D shares.
Albion Ventures is launching a GBP25m share issue for Albion Development VCT through a new issue of D shares.
This is the fourth share issue since Albion Development VCT was launched in 1999.
The new D shares will eventually merge with the existing ordinary shares after five years.
This is Albion Ventures’ first fundraising following the management buyout of Close Ventures in January 2009.
The fund’s investment strategy is to establish a diversified portfolio of holdings in smaller, unquoted companies, whilst at the same time selecting and structuring investments in such a way as to reduce the risks normally associated with investment in such companies. This includes restricting the use of external bank borrowings such that the VCT, wherever possible, has a first charge over the investee company’s assets.
The existing ordinary share portfolio has been constructed to create a spread across a broad number of sectors, with those that are asset-based and consumer facing, such as pubs, health and fitness clubs and cinemas, being balanced by higher growth businesses in the business services, healthcare, IT and environmental sectors.
Since launch Albion Development VCT has paid over 46 pence per share in dividends in respect of its ordinary shares.
Patrick Reeve (pictured), managing partner of Albion Ventures, says: ‘We think the demand for new VCT shares will increase this year and next as high earners seek alternative tax efficient investments to pensions. Smaller companies can create excellent returns at this point in the economic cycle and investing through private equity ensures investors can capture the growth. We will continue to invest without banks to ensure maximum value and control for shareholders.’
