Ireland Seeks VC Jumpstart
Ireland hopes to transform its venture capital industry by launching a €500 million “Innovation Fund” the Irish Times reports.
Taoiseach Brian Cowen, who heads the Irish government, wants to bring the venture capital culture of the United States to Ireland, where there is currently a dearth of such investment.
By doing so he hopes to make Ireland “a honey pot for the best European entrepreneurs” and also to convince venture capital companies to locate in Ireland, writes the Irish Times.
Although Ireland’s was one of the European economies worst hit by the global financial crisis, the government has promised to raise €250 million for the new fund, with the balance coming from private investors.
The government share will be drawn equally from the National Pension Reserve Fund and Enterprise Ireland’s Innovation Fund.
The new fund is expected to call for expressions of interest in September 2010.
In a press statement, Enterprise Ireland said that more than 300 high-tech companies were established across Ireland over the past four years, with Enterprise Ireland supporting 73 with a total of $26.5million last year. “Many were founded by returning emigrants—former executives with large technology companies in the U.S. and elsewhere, now bringing international business acumen, expertise and connections to their new Ireland-based enterprises,” Enterprise Ireland said in the statement. —Alex Derber
Gilde Finalises €800m Fund
Mid-market private equity investor Gilde Buy Out Partners has closed its fourth fund at €800 million.
Gilde’s Buy-Out Fund IV fund closes four years after the €600 million Gilde Buy-Out III and will continue the investment strategy of its predecessor.
The fund expects to make equity investments of between €25 million and €200 million in middle market companies across a range of industries, focusing on the Benelux region, Germany, France, Switzerland and Austria.
Improved investor sentiment this year saw the fund oversubscribed, a pleasing development for Gilde.
“At the same time last year we wouldn’t have thought that it would be oversubscribed, but in the end we saw it coming as the market has really improved since March 2010,” says Koos Teule, investor relations officer at Gilde.
Pension and sovereign wealth funds account for most of Buy-Out IV’s investor base, which is located primarily in Europe and the United States. —Alex Derber
Lloyds Sells PE Arm to Coller
Lloyds Banking Group has sold the bulk of its private equity business to London-based Coller Capital.
Coller paid £332 million for a 70% stake in the Bank of Scotland Integrated Finance (BOSIF) portfolio. Lloyds retains 30% of BOSIF, which will be renamed Cavendish Square Partners.
The portfolio is made up of 40 private equity investments valued at £480 million.
The sale values the portfolio—which includes holdings in shirt maker TM Lewin and Vue Entertainment cinemas—at £480 million pounds, representing a “small premium” to its book value, according to Lloyds.
Lloyds inherited BOSIF from its ill-fated takeover of HBOS, the debilitating effects of which have forced it to sell off non-core assets, of which BOSIF is the sixth to have been divested in the past year.
“Through this transaction, we are crystallising value in these investments whilst retaining an interest in the investee companies with which we have had positive relationships for several years,” says Truett Tate, Lloyds group executive director, Wholesale. “This deal will ensure that we share in any future upside of our investments.”
Coller has said it will retain the existing BOSIF team to manage the fund. —Alex Derber and Myles Neligan, Reuters
Acuity Environmental Fund Elicits Tepid Response
Acuity Capital has shelved its Acuity Environmental VCT 2 following disappointing share take-up.
Hoping to maximise investment opportunities, the company launched a linked offer for two environmental VCTs in November 2009, but has only raised £5 million of a planned maximum of £20 million.
The environmental fund plans to exploit opportunities in anaerobic respiration—organic waste recycling—which has become a British government priority following European Union landfill regulation.
“The government is driving the key opportunities in this market,” says Nick Ross, managing partner of Acuity Capital. “The appetite is there among investors, but it’s a new area that a lot of people are unfamiliar with, so it will take time.”
The capital raised so far has been allocated to Acuity Environmental VCT, for which the share offer remains open. —Alex Derber
Midven Launches Exceed Fund
An £18 million fund to support high-growth business in the West Midlands, United Kingdom, has been launched by venture capital firm Midven.
Private equity house Lloyds Development Capital, the European Regional Development Fund and regional development agency Advantage West Midlands all invested in the Exceed – Midlands Advantage Fund, which will be managed by Midven.
The fund will target high-growth businesses in the West Midlands requiring between £250,000 and £750,000 of investment.
It marks the third and biggest collaboration between Advantage West Midlands and Midven, which administers the £8m Early Advantage Fund and £17.5 million Advantage Growth Fund. —Alex Derber
Finance Yorkshire Preps Investments
Finance Yorkshire, the £90 million venture fund established to support business in the Yorkshire and Humber region, has opened in Barnsley, United Kingdom, and expects to announce its initial investments soon.
“We have received hundreds of applications for finance from businesses across the region and during the coming weeks we hope to announce our first investments,” says Tony Parson, deputy chairman of Finance Yorkshire.
The fund will target seed corn, loan and equity-linked investments, ranging from £15,000 to £2 million.
Financial backing from the European Union has enabled the project, which attracted £30 million from the European Regional Development Fund (ERDF). —Alex Derber
Pension Funds Form €200M VC Fund: INKEF Capital
Pension funds Stichting Pensioenfonds ABP (ABP) and the Ontario Municipal Employees Retirement System (OMERS) have teamed up to form INKEF Capital, a €200 million venture fund that will invest in startups in Canada and the Netherlands.
The newly launched fund is an acronym for Investing in the Knowledge Economy of the Future. Each of the pension funds will put up half the capital for the fund, which is expected to have a lifespan of 15 years. It will invest in new companies and technologies from an early stage of their development onwards. The fund will target technology transfer offices of universities, informal investors, regional funds and spin-offs of new technologies by existing companies.
APB is the pension fund for employers and employees in service of the Dutch government and the educational sector. With more than $47 billion in net investment assets, OMERS is one of Canada’s largest pension funds and provides benefits to more than 400,000 members. —Aimee Donnellan