VCT consolidation underway?

Continuing the long-awaited consolidation of the venture capital trust (VCT) sector, VCF Partners, the technology investment firm which manages the Foresight Technology VCTs, has acquired Advent Fund Managers, the VCT management business of Advent Venture Partners. The transaction, which is subject to the approval of the shareholders of Advent VCT and Advent 2 VCT, will result in the two Advent VCTs being managed by VCF Partners. The Advent VCT team will join VCF Partners. Advent Venture Partners will continue to focus on its institutional fund business investing in European early and later stage venture opportunities.

VCF Partners currently manages three VCTs with £65m funds raised. These include the top-performing VCT fund Foresight Technology. Bernard Fairman, managing partner of VCF Partners, said: “We are very pleased to be able to acquire the management of the Advent VCT funds. We see this acquisition as a step in the consolidation of the VCT sector which, we believe, is set for substantial growth. We are delighted to be joined by the Advent VCT team of David Hughes and Andrew Page, whose skills are an excellent fit with VCF Partners.”

A consolidation of the VCT industry has been on the cards for a while as many of the smaller VCTs have been suffering dwindling share prices, so their only chance of survival is to join forces with their counterparts. Earlier this year Matrix Group acquired GLE Development Capital (GLEDC), the private equity arm of Greater London Enterprise. Matrix is merging GLEDC with its existing private equity business to form a new private equity fund management company, Matrix Private Equity Partners (MPEP.) The new company will have a total of £65m assets under management. Founded in 2000, MPE has raised two funds, the Matrix Venture Fund VCT and the Matrix Enterprise Fund. GLEDC has around £50m venture capital funds under management from three principal clients, TriVen VCT, TriVest VCT and the Baring English Growth Fund.