Isis Equity Partners is planning a series of share offers for the
Baronsmead 4 VCT to increase its size to £30m over the next nine
The first of these offers aims to raise up to £2m for the 2003/04 tax
year and will offer investors extra shares of 0.5 per cent of the amount
they invest to encourage early investment.
Baronsmead 4 was established in December 2001 and has raised
£21m to date. During that time it has made 17 qualifying investments,
of which two have been sold. Further fund raising will increase the
portfolio to around 40 investments.
The VCT aims for long-term capital growth by investing in a portfolio
of unquoted and Aim-listed companies. Although it is a generalist
VCT, it favours sectors such as business services, consumer
markets, healthcare, information technology and media &
communications. Current investments include Aim-listed IT training
firm Xpertise Group and marketing services agency RLA Media.
The VCT's investment policy is to target established and profitable
companies that have carved out a strong niche in their particular
market, supported by entrepreneurial management teams who are
committed to good business strategies. They are likely to be seeking
to raise new capital for expansion or will be the subject of a
Product providers are choosing to top-up existing VCTs in the current
market rather than introduce new VCTs because investors' appetite
is still below its peak as a result of the recent bear market.
A top-up issue like Baronsmead 4 may also be more beneficial
investors than newly established VCTs because they have a track
record and will already have some qualifying investments in place. In
contrast newly-established VCTs initially hold cash or fixed-interest
while suitable unquoted companies are found.
Investing in unquoted companies as the market recovers could be a
shrewd move for investors seeking VCT tax advantages, but this is
also matched by high risks that other investors will not feel