UK VCs Ask Gov’t for £1 Billion Bailout

LONDON (Reuters) – British venture capitalists are planning to ask the government for a billion pound ($1.4 billion) bailout to try to stop hundreds of young UK technology companies going bust due to lack of funding, the Financial Times reported.

The FT quoted Richard Anton, a partner at Amadeus Capital, one of the UK’s largest venture capital investors, as saying many fast-growing companies could go bust this year, threatening jobs.

“Starved of capital, companies will go to the wall or they will be forced to cut back too far, reducing jobs and losing competitiveness,” Anton told the paper.

“This question is of great importance to the UK, as these are fast-growing companies that will create jobs.”

The global financial crisis has caused a severe shortage in investment in venture capital funds, leaving many venture capital-backed technology companies in trouble.

The FT said the sector was pressing the government for a one billion pounds “fund of funds” to support the sector.

(Reporting by Kate Kelland; Editing by Andre Grenon)