The VCTs aim to provide long-term income with the potential for capital growth. They aim to pay average annual dividends of 6.5p a share in the first five years. Matrix says this is equivalent to an annual 9.3 per cent return on the net investment of 70p per share for qualifying investors who are able to claim the full 30 per cent upfront income tax relief.
Investment will be made mainly in medium-sized industrial rooftop solar energy projects in the UK, and potentially in Europe in line with VCT rules. These projects will use solar photovoltaic technology, which Matrix regards as proven and reliable, to generate electricity from sunlight using semiconductors.
Matrix feels this type of clean energy is attractive because revenues are underpinned by the UK government Feed-In Tariff.
FITs are Government incentives for individuals and companies to generate their own electricity using renewable energy . They provide a fixed payment for each unit of electricity generated for 20 to 25 years, which provides a predictable, long-term inflation-protected revenue stream for investors. There is a further tariff for energy that is not consumed and which is sold in to the national grid.
The intention is for the VCTs to invest the majority of the money raised through this offer by April 2012, enabling investors to benefit from the highest guaranteed FIT prices before the Government reviews the regime.
To identify suitable opportunities, Matrix is negotiating a pipeline of exclusive opportunities for solar energy projects with Gazeley Limited, a developer of distribution warehouses. Under the agreement with Gazeley, Matrix has the right of first refusal to finance the construction of solar energy projects in the UK and Europe. Negotiations with other developers and distribution warehouses are also taking place.
This VCT is treading similar ground to solar VCTs from Foresight and Ingenious. All three draw on expertise of solar energy projects and in VCT management, but the solar VCT is a new concept and some investors may be wary until a track record is established.