Venture capital trust (VCT) provider Octopus Investments has launched a GBP30 million fundraise for Octopus Apollo Venture Capital Trust (Apollo VCT).
The new share offer for Apollo VCT comes just two months after Octopus Titan Venture Capital Trust (Titan VCT) launched a GBP50 million fundraising offer.
Launched in 2006, Apollo VCT seeks to invest in established, profitable companies with the aim of providing investors with a regular tax-free dividend income and has built a strong track record of delivering regular returns on an annual basis. It paid its first dividend in 2008 and since then has paid out a total of 30p per share to investors. It now targets an annual regular dividend of 5p per share.
Apollo VCT offers investors access to a diverse portfolio of around 25 established companies. In addition to providing follow on funding for existing portfolio companies, the team seeks to invest in new profitable companies with attractive positions in their markets. Successful companies backed by Apollo VCT to date include SCM World, a fast-growing business providing supply chain support to many of the world’s largest companies, and Countrywide Healthcare Supplies, a specialist supplier to the UK’s rapidly growing care home sector.
Grant-Paul Florence, head of the Intermediate Capital team at Octopus and fund manager of Apollo VCT, says: “Through Apollo VCT we look to back established and successful management teams behind companies with predictable cash flows and a competitive advantage in their markets. Over the years we’ve backed some fantastic businesses, and this fundraise will enable us to continue to support those companies while also seeking to invest in new portfolio companies.
“VCTs are a vital source of funding for smaller businesses and there’s a strong pipeline of attractive investment opportunities across the country that can help Apollo VCT deliver on its mandate for investors. For those investors looking for regular tax-efficient income and who are comfortable with the risks of investing in smaller companies, Apollo VCT can prove to be a compelling investment prospect.”
Paul Latham (pictured), Managing Director at Octopus, says: “We continue to see increased demand for access to VCTs and the tax-efficient benefits they can offer investors. The recent changes to pensions legislation, including the continued reduction in the lifetime allowance and proposed tapering of the annual allowance from April 2016, means that more investors are looking for alternative tax-efficient income streams to complement their existing pension arrangements. We launched our first fundraise of the season two months ago. This latest fundraise gives potential VCT investors greater choice and flexibility when it comes to choosing the product best suited to their financial planning goals.”