Fund exits H2O with 142% return
ENTERPRISE Ventures has exited from its investment in fibre optic network company H2O Networks, with a strong return on its investment.
The Preston-based venture capital firm says its Coalfields Enterprise Fund has made 3.6 times its original investment, representing an internal rate of return of 142%.
It first invested in Newton Le Willows-based H2O Networks in September 2006 to finance the company’s growth plans, with a further round of investment in mid-2007.
The company deploys its fibre optic network to supply high speed internet via underground waste water pipes – meaning the system can be laid 80% faster than the usual method of road digging.
Elfed Thomas, chief executive of H2O Networks, said: “Over the last two years, H2O Networks has experienced exponential growth. Our tried and tested proposition has grown from a point to point fibre optic solution for businesses, to building town and city wide networks as seen in Dundee and Bournemouth, as well as International activities. This exit is the start of the next phase in the evolution of this company.”
The Coalfields Enterprise Fund is managed by Enterprise Ventures on behalf of the Department for Communities and Local Government and was set up to finance the growth of companies and encourage entrepreneurship in former coalfield areas.
Wayne Thomas, investment director, said: “Since EV initially invested into H20 Networks, the business has grown significantly thanks in no small measure to the drive and commitment of its management team.
“Successful investments often depend on backing the right team with the right idea. With the assistance of EV, the team has built a solid platform from which to grow further.”
Manchester-based Laytons Solictors acted for Enterprise Ventures on the transaction, Addleshaw’s Manchester office acted for the company and Capsticks of London acted for the management team.
