View more on these topics

Generalist angle from Downing Electra

Downing Corporate Finance is raising up to 40m for the Electra Kingsway VCT 2, a generalist venture capital trust managed by Electra Quoted Management, a subsidiary of Electra Partners.

Electra Quoted Management specialises in private equity investment and was established in 1981. It manages the Electra Kingsway VCT which was introduced in September 2001. As at August 31, 2004, the VCT had made 17 investments in qualifying companies at a total cost of over 11m.

This second Electra VCT was established as a result of the increased upfront income tax from 20 per cent to 40 per cent over the next two years. It will have the same investment strategy, directors and investment team as the original Electra Kingsway VCT.

The money raised from the share issue will initially go into the Electra investment trust, the Electra active management Oeic, a portfolio of fixed interest securities and cash. During the next three years, it will gradually be invested in a portfolio of around 30 unquoted and Aim-listed companies.

The companies chosen will mainly be established companies rather than start-ups. They will have solid business plans, good management teams, the ability to generate profits and must demonstrate a strong demand for the products or services they offer.

Many VCTs have been established recently as a direct result of the enhanced income tax relief, but some focus only on Aim-listed companies. The investment team at Electra believe Aim companies are currently overvalued and the investment strategy of this VCT allows them to invest in Ofex and unquoted companies while they believe this is the case.

This degree of flexibility is unavailable to VCTs focusing entire on Aim companies and the Electra investment team may find it easier to find qualifying investments with good growth potential because they are not restricted to Aim companies.


NU back with plan pledging 20% return over six years

Norwich Union is offering a second tranche of its guaranteed growth plan featuring a minimum return of 20 per cent. The plan has been designed to provide a return of 20 per cent after six years, regardless of what happens in the FTSE 100. Alternatively, it will return 60 per cent of the growth of […]

Nikko sells Mortgages plc shareholding to Merrill Lynch

Nikko Principal Investments, the majority shareholder and management shareholder of Mortgages plc has sold its shareholding to Merrill Lynch. Mortgages plc, the specialist non-conforming mortgage lender will retain its name and continue to operate as a wholly-owned subsidiary of Merrill Lynch. The terms of the deal were unavailable. Nikko acquired a majority shareholding in Mortgages […]

Survey finds IFA portals will continue to play major role

Most IFAs will stay independent after depolarisation, according to technology solutions provider Focus Solutions. Eighty-two per cent of 840 IFAs questioned by Focus in August said they will stay independent and are ready to take on the new distribution challenge set by the FSA. Only 17 per cent of IFAs will adopt a combined independent […]

Multi-Manager View

The wisdom of taking bets on asset allocation is a frequent topic of conversation with financial advisers. We take the conservative view that the neutralisation of asset allocation risks is the most appropriate approach for our products and market. If a multi-manager is taking big bets on behalf of clients, there are three possible outcomes. […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment