Bank to offer secondary issue of shares to UK investors
The Triodos Venture Capital Fund (TVCF), which launched earlier this year, is looking to offer a secondary issue of shares for UK investors.
The fund was brought out by Triodos Bank which since 1998 has been developing services for social and environmental businesses seeking investment.
TVCF targets expanding businesses that are active in organic processing and retailing, renewable energy and environmental technology. The fund is planning to invest in about 20-25 enterprises in these growth sectors, aiming to deliver market-level returns to investors.
TVCF is looking to raise E50m through the secondary issue which is likely to launch next year. Support is expected to come mainly from institutional investors. However, it is envisaged that it will be opened up to individual investors through the Triodos Bank at a later stage.
Alexander Schwedeler, manager of TVCF, said: 'The market is more than ripe for this kind of investment. The companies we invest in are in a rapid growth phase and need venture capital to increase production capacity, market or product development, or provide extra working capital. Typically, they have an annual turnover of between £3 and £30m and annual growth rates of 15%-50%.
'The fund will be active mainly in the UK, the Netherlands, Belgium and Germany, countries at the forefront of sustainable development and consumer awareness, where demand for healthy, environmentally friendly products is strong. The European Union is the world's largest market for organic products, with retail sales of organic food and beverages amounting to more than E5bn in 1997.'
Within the organic area, TVCF will finance businesses such as fruit and vegetable distributors, coffee and tea wholesalers and meat and dairy companies.
He said: 'Product innovation in this sector is pushing up demand and most companies are struggling to keep up with it. Venture capital will help these businesses make the most of their opportunities for growth, with benefits for the whole chain from producer to consumer.'
Renewable energy is another target market for the fund. Decentralisation of regulated energy markets around the world and a growing concern about climate change are driving a change in the energy infrastructure towards renewables. Triodos believes.
Schwedeler added: 'Many new products and services are being developed as a result, such as solar photovoltaic systems for domestic and commercial use. Many companies in such markets as these have reached break-even and now need expansion capital.'
The investments in wind technology development and solar photovoltaic businesses will also include suppliers of components such as turbines and blades, as well as solar cell installation contractors. Other environmental technologies such as fuel cells, new battery systems, water treatment, recycling, natural textiles and natural cosmetics and medicine will also be targeted.
The target audience are typically individuals with some experience of making invest
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