Scottish firms to get £50m through growth fund

By PETER RANSCOMBE
Published on 01/02/2013 09:40

THE head of the Business Growth Fund’s (BGF) Scottish operations wants to pump £50 million into companies north of the Border this year, grabbing a quarter of the total cash set aside for UK investments.

Scottish director Simon Munro said his team was looking at deals across a broad range of industries and would complete its next investment “within the next few weeks”.

“Now that we’ve made investments, people understand what we do and realise that equity investment isn’t all that scary” he told The Scotsman.

“People are beginning to realise that we can help them grow their businesses and so we’re now getting more companies coming to us to find out more.”

The £2.5 billion fund was launched in 2010 by the five biggest British banks – Barclays, HSBC, Lloyds, Royal Bank of Scotland and Standard Chartered – and the British Bankers’ Association to invest between £2m and £10m in fast-growing businesses, in return for a minimum 10 per cent equity stake.

The BGF – which invested £120m last year in 21 businesses, including £25m handled by its Scottish team – places a director on to the board of its portfolio companies to help stimulate further growth.

Three Scottish companies – Edinburgh-based Morphsuits fancy dress maker AFG Media, M-Squared Lasers of Glasgow and Aberdeen-based oil and gas services firm Stats Group – secured funding last year.

The BGF team in Aberdeen, which specialises in oil and gas investments, also advised on a deal involving Portsmouth-based oil and gas services outfit Magma Global.

Munro plans to recruit a further four staff this year to take his headcount to ten spread across the fund’s branches in

Aberdeen and Edinburgh.