Investment manager JO Hambro has raised GBP9 million for its first VCT, which focuses on the leisure and media sectors. Around a quarter of the VCT’s capital has been raised from two of JO Hambro’s hedge funds. The firm has funds of around GBP750 million under management with GBP120 million of this in private equity, including the Trident Private Equity Limited Partnership. Christopher Mills is chief investment officer for the fund.
For the firm’s first VCT, focused on leisure and media, JO Hambro is partnering with Humberts Leisure, a consultancy serving the leisure property market. Around three-quarters of the VCT’s investments will be in the property-led leisure industry drawing on the deal flow opportunities available through Humberts Leisure. These investments will span sectors such as health and fitness clubs and branded pubs and restaurants, which are currently very active. Martin Hemsley, who is finalising the details of the VCT’s second undisclosed investment, said:
“Some types of media deals are having a hard time raising funds. We’ve been buried under proposals.” The fund will not be invested in Internet or telecoms related deals but opportunistically in more traditional areas of the industry such as publishing.
The VCT will typically invest GBP0.5 million in about 12 deals worth GBP2.5 million to GBP3 million. The VCT’s first transactions, in which it has taken
the lead position alongside other Hambro funds, have been investments in a holiday village and a service business. Hemsley says the fund is looking for small leisure groups, with growth potential, to develop and sell on rather than float on AIM. The VCT is avoiding early stage investments and with the help of Humberts Leisure, which has worked with a number of different management teams,
is looking to back proven teams with small but proven business concepts. According to Hemsley, JO Hambro plans to raise a second VCT with a similar focus in the near future.