FLV Fund winds down activity

Following a tough year, Belgian VC firm FLV Fund will wind down its portfolio. The target date for ceasing all activity is 21 December 2004.

The firm has never fully recovered from the scandal surrounding embezzlement in its Korean fund and its involvement with US speech software firm Lernout & Hauspie, which was hit by a fraud scandal.

The intention is to realise FLV Fund’s portfolio gradually through regular exits. All further activity must be decided by the shareholders. Should a serious offer for a take-over be received, FLV Fund will submit it to the shareholders.

The new business plan has been approved by the board of directors of FLV Management and is subject to shareholder approval. FLV fund will not invest in new ventures and will closely monitor its active portfolio companies. Follow-on investments will be made for defensive reasons only. For example, to protect FLV fund’s participation in existing portfolio companies with a positive track record.

The firm is implementing a restructuring programme and reduction of recurring annual operating cost to a maximum of euro3 million. Since June, FLV Management’s total headcount has decreased from 19 to 14. Two senior employees have left the company, former CEO Philip Vermeulen and Filip Vandamme, former CEO of FLV Asia Pacific. Further redundancies will be made and the management team’s responsibilities will be reviewed with regards to workload and specific expertise.