Major bank fund ‘to come to Yorkshire’
THE £1.5bn equity fund being planned by the major UK banks is considering creating its headquarters in the West Midlands with a regional operation in Yorkshire, TheBusinessDesk.com has learned.
The Business Growth Fund is due to be officially launched in April after the major banks – including Barclays, HSBC, Lloyds, RBS, Santander, and Standard Chartered – started the process of creating a vehicle to demonstrate support for UK businesses following the credit crunch.
The fund is expected to target high-growth companies through support of between £2m and £10m in return for equity.
The British Bankers’ Association is managing the project and is currently in talks with the Financial Services Authority over regulatory issues.
Key City figures have been tipped for the top jobs, with Sir Nigel Rudd linked to the chairmanship and former LDC boss Michael Joseph lined up for the chief executive’s role.
Last week, it was reported that the fund was likely to be headquartered outside the capital, and a recruitment process is underway to build teams of private equity professionals in Manchester, Leeds and Birmingham.
TheBusinessDesk.com has learned that Birmingham is in a leading position to be selected as the location for the fund’s headquarters and main operating centre, with negotiations between city representatives and the fund are at an advanced stage.
A source close to the negotiations said: “They’re looking for a rollout of the fund in the spring, and there are talks underway to show Birmingham is the right location for their base.”
A spokesman for the British Bankers’ Association said: “We are certainly considering Birmingham, as we want the Business Growth Fund to be based out of the City of London, close to the businesses that actually need the fund. Even if the decision ultimately is for the HQ to be somewhere else, the fund is very likely to have offices in the region.”
The fund has been likened to 3i, which was formed by the government and the major banks in 1945 as the Industrial and Commercial Finance Corporation, before being renamed Investors in Industry in 1983.
Its brief was to provide corporate finance to small and medium sized companies. It was floated in 1994 and is now a global private equity company that now manages funds for external investors.
