HSBC has merged its venture capital arm, HSBC Ventures, with HSBC Private Equity. The amalgamation, which took effect on January 1, is aimed at developing the group’s mid-market presence. The enlarged group will focus on deals worth between GBP2 million and GBP10 million, particularly in the UK, which previously fell between the remit of the two groups.
HSBC Ventures has closed its office and moved into HSBC Private Equity’s London, Vintners Place, office. Of the ten members of the Ventures team, which was led by managing director John Brandon, five will join the private equity arm. A group including Paul Chambers, Les Goble and Jon Stradling will stay on as part of HSBC’s clearing bank division.
HSBC Ventures was previously responsible for equity investments of between GBP250,000 and GBP2 million in situations including buyouts, acquisitions and development capital. The new group will not cover deals in this bracket. Launched in 1992 and dedicated to investing in the UK, Ventures committed over GBP32.5 million to 53 companies. It has also invested over GBP20 million in regional UK Enterprise Funds, which will continue to be overseen by Les Goble.
Noel Quinn, head of planning and development, HSBC Commercial and Corporate Banking, said: “The merger will allow a broader range of businesses to benefit from [HSBC Ventures’] help, backed by wider resources and funds of HSBC Private Equity.”
HSBC Private Equity, the weightier and more senior of the two divisions, manages some GBP1.2 billion of funds in Europe. It traditionally invests in businesses worth between GBP30 million and GBP600 million in old economy industries (such as engineering, chemicals, electronics, transport and healthcare) but last year launched a fund dedicated to emerging technologies and the new economy. It has offices in London, Manchester, Paris, Dusseldorf, and Stockholm, from which it has invested in over 400 businesses in its 30-year history.