Private equity investor in public share offering

Feb 27 2010 by Peter McCusker, The Journal

PRIVATE equity investor Newcastle- based NVM has launched a public offering of 15 million shares in its Northern 3 VCT PLC fund with a target of raising up to £13.5m.

NVM has the benefit of a 25-year track record of making unquoted investments and £325m invested within that period.

There has been a string of successful exits from NVM’s portfolio companies in 2009, including DxS, Pivotal Laboratories, Liquidlogic and Abermed – generating realised gains of £4.9m for Northern 3 VCT and reinforcing the company’s ability to meet its objective of paying an annual tax-free dividend of at least 4p per share. Investors will benefit from dividends paid from July 2010.

NVM’s sale of DxS to QIAGEN has been shortlisted for the Deal of the Year category at the BVCA/RealDeals Private Equity Awards – taking place on April 22, 2010 – due to the outstanding return the deal is generating for the shareholders of NVM’s funds.

NVM chairman Tim Levett said: “Prospects for VCT fundraising are positive this year with over 20 VCTs hoping to raise a combined target of £500m.

“I predict that at least 50% of the target will be raised for the 2009/2010 tax year. As the UK starts to slowly emerge from the recession those companies that have survived are in a stronger position to grow their business and, with lack of bank funding in the SME sector, the opportunities for VCTs to find attractive growth deals has improved.

“Changes to the rules related to investments in SIPPs have resulted in people needing to find other tax efficient investment opportunities and VCTs, with their income tax relief on investment and dividends paid tax-free, are an obvious choice.”

The key points of the offer are as follows:

Funds sought – up to £13.5m (before expenses).

Issue offer price per share – 95.0p.

30% income tax relief on subscriptions up to £200,000 in 2009/10 & 2010/11 tax years.

Minimum investment £5,000.

Maximum investment (per tax year) £200,000.

Active share buy-back policy – normal market purchases at a 15% discount to NAV.

To receive a copy of the prospectus (including application form) by post (free of charge) please call 0191 244 6000 or email new@nvm.co.uk

Companies that have survived the recession are in a stronger position to grow their businesses