By Adam Lewis F&C Ventures, the private equity arm of the Foreign & Colonial group, has becom...
By Adam Lewis
F&C Ventures, the private equity arm of the Foreign & Colonial group, has become independent following a management buyout. The business has now been renamed Graphite Capital.
This follows the sale of HypoVereinsbank's 90% stake in F&C Management to Eureko earlier in the year.
Graphite Capital has total funds under management of more than £500m and manages six funds backed by 50 institutional and 27,000 private investors.
Following the buy-out, and subject to shareholder approval, Foreign & Colonial Enterprise Trust, the top performing of all investment trusts over 10 years, according to the group, will change its name to Graphite Enterprise Trust.
This should not affect investors as the trust will continue to be included in all F&C saving schemes.
As of 24 April 2001, the NAV of this trust was 304.8p and it was trading at a discount of 15%. On 23 April 2001, its share price over three months was down 1.6%, compared to the sector average which was down 7.2%. Over three years, the share price has risen 3%, against the average in the venture & development capital sector of 77.8%.
Rod Richards, managing partner of Graphite Capital, said: "The ownership has changed but our approach has not, it is the same team doing the same things in the same way. Our style is relaxed and open-minded so we are short on formalities such as committees.
"Our success has been founded on combining informality with rigorous analysis and a consistent approach to investment. We have always been opportunistic and entrepreneurial and will remain so in the future."
Since 1990, the team has invested in more than 80 companies and has realised half of these investments through either floatation or trade sales. To date, the return on the total assets it runs has been more than 36% per year and the return on realised investments has been 43% per year.
Richards said: "We have built up a strong track record by investing in mid-market companies and this focus will not change as we believe these companies offer the best prospects for high returns. We will consider any sector including some not favoured by other private equity investors, such as financial services and retail. Investing in cyclical and unfashionable businesses has served us well in the past and should continue to do so."
Graphite Capital has a team of 12 investment managers, more than half of whom have been with the company for more than eight years. The team now owns 100% of the business and all employees have an interest.
The group invests in all types of later stage financing, primarily in management buy-outs, buy-ins and expansion capital, but can also become involved with replacement capital and turnarounds, with a main emphasis on UK-based companies.
Last year, approximately £100m was invested in 12 companies and more than £250m is currently available for immediate investment.
The team has backed companies such as Computacenter, Close Brothers, Intermediate Group, ShareLink, PSD Group, Ottakar's and Wagamama.
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