We’re a serious player, says Finance Yorkshire’s CEO
FINANCE Yorkshire chief executive Alex McWhirter believes the organisation is becoming a key investment vehicle as ambitious lending targets are set for 2013.
The venture capital and loan fund wants to invest £28m over the next 12 months having pledged £32.5m over the past two years.
Speaking to TheBusinessDesk.com, Mr McWhirter admitted the target was a big one but said he had confidence it would be hit.
He said: “We’ve invested £17.5m this year and that’s a good figure. We always want to do more and I think we’re going to next year.
“2013 is a very important year for us. We’ve got some big investment targets but we’ve got a great relationship with the marketplace.
“I really do believe that in 2013 a lot of companies in this region are poised to do really well and could be in a position where they are looking for funding for the future.”
However, he stressed that Finance Yorkshire, which was launched in August 2010 with a £90 fund made up of finance from the European Regional Development Fund, Yorkshire Forward and the European Investment Bank, would not “throw money” at every application that was made.
Mr McWhirter said that deals activity had increased substantially over recent months.
“We’re showing the market we’re a serious player,” he said. “Over the last three months the quality of applications and business propositions has increased. We’re getting the right businesses coming to speak to us.”
Finance Yorkshire has made a total of 280 investments, which have created and safeguarded more than 5,190 jobs and generated a private sector leverage of more than £56m, he claimed.
Significant deals over the past 12 months include a £1.29m equity linked investment in Turbine Efficiency Group, which specialises in the supply and maintenance of gas turbines around the world.
It was Finance Yorkshire’s largest deal to date and has enabled the company to open a new 4,000 sq ft facility in Doncaster to expand its services and global operations.
A £400,000 seedcorn investment was made in Carlton Manufacturing, a developer and manufacturer of sustainable construction materials.
Carlton moved to its new 17,000 sq ft premises on Newmillerdam Business Park, Wakefield, in April and has since expanded its workforce.
AIM-quoted Braveheart Investment Group acquired Neon, the company that manages the £48m Finance Yorkshire Equity Fund, in March.
Asked about the collapse of waste management firm Sterecycle, a business the Finance Yorkshire Equity Fund invested £1.2m in, Mr McWhirter said: “We lost that investment and it’s very regrettable. But you have to expect risk. Some of these things aren’t going to work out.
“But we see Finance Yorkshire as being a legacy that we can reinvest and the number of investments that haven’t worked out have been remarkably low.”
Commenting on the general economy, Mr McWhirter said confidence was key.
“If this is lacking, owner managers will be reluctant to develop and expand their businesses, reducing the possibility of further growth in the long-term.
“My encouragement to business owners and managers is to be confident and implement business plans that can help them take advantage of market opportunities. Whatever you plan to invest in, believe you will reap the rewards.”
He added: “There are numerous sources of finance available to owner managers, but this landscape of funding lacks cohesion, and faced with such confusion, they tend to approach the likes of banks and friends to secure finance.
“This must change in order for the UK economy to grow. Hundreds of small and medium-sized businesses have found additional gap funding with support from organisations such as Finance Yorkshire, but more needs to be done to enable thousands to access all forms of finance in a simple and efficient way.
“Therefore, the key priorities for the year ahead should be developing greater cohesion, untangling the financial landscape and taking a leap of faith by making more investments.”
