SCOTTISH Equity Partners (SEP) highlighted its "natural desire" to back technology-based companies north of the Border, as it revealed the amount it had raised for its latest fund had risen from £185 million to £200m.
The Glasgow-based growth equity and venture capital house, which has hit the headlines recently through its backing of former IndigoVision chief executive Oliver Vellacott's efforts to secure a buy-out of this publicly-quoted, video-over-internet group, has over the years funded some of Scotland's most successful technology companies.
SEP managing partner Calum Paterson yesterday voiced his ambitions to back more Scottish businesses, as he highlighted current investments in flight search engine firm Skyscanner and entrepreneur David Sibbald's information technology analytics venture Sumerian.
Revealing the SEP IV fund had been closed at £200m, up from the £185m raised by September and taking SEP's total funds under management to about £600m, Mr Paterson said: "We are very keen to invest in Scotland...to be as active as we can in Scotland. In the current portfolio, we have a disproportionately higher number of companies in Scotland than elsewhere in the UK.
"I actually hope that is the case with the new fund as well. We have a natural desire to invest in companies in Scotland. We would like to do more of that going forward, without mentioning any names."
SEP last month bought a 6.63% stake in Edinburgh-based IndigoVision, which has developed technology used in internet-based CCTV surveillance systems in airports. SEP said on December 23 that it was considering making a fresh proposal to buy Indigo-Vision, having had several approaches about a bid with Mr Vellacott rejected by the company's board in November.
Mr Paterson declined to comment about IndigoVision yesterday.
He estimated it would take "four years or so" to invest the funds raised for SEP IV. He anticipated making 20 to 25 investments in the £2m to £20m range.
He highlighted SEP's focus on "technology-enabled" companies in the information technology, healthcare and energy sectors.
Mr Paterson believes private equity funding could play a key part in enabling growth at a time when bank finance is difficult for many businesses to secure.
Citing the bank funding situation, he said: "For us, if anything, that is improving the opportunities...because, in the absence of funding from banks, I think the case for companies raising equity finance, long-term equity finance, is greater really, or the need for companies to do that is greater."
Noting the "general economic backdrop isn't as strong as it might be", he added: "I think, right now, in terms of where we are in the broader economy, equity finance is very important for companies themselves in creating economic wealth but also more generally in terms of developing the economy, and getting the economy growing again."
SEP, which has enjoyed rapid growth since it emerged from taxpayer-backed economic development agency Scottish Enterprise in 2000, said its new fund "ranks as one of the largest raised in Europe over the last year".
Its existing investors accounted for 80% of the funds raised. About half the money came from UK-based investors, with the remaining 50% from investors elsewhere in Europe and in the US. Pension funds account for almost 60% of the total, with fund-of-fund investors, family offices and corporates also putting up money.
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