Acuity Capital was formerly part of the Electra Partners Group andbecame independently owned by its management team in 2008.
The new fund will provide growth by investing in a portfolio of 20 to 30 UK smaller companies drawn from the Hoare Govett Smaller Companies Plus Aim index. It will focus on companies with marlket capitalisation of below £150m, but the bulk of the portfolio will comprise companies below £75m. Around 30 per cent wlll go into companies at the bigger end of the market cap spectrum that can be traded more easily over the short-term. Special situaitons will make up 10 per cent of the fund.
Acuity Capital will adopt a private equity investment style, with the managers being actively involved in the companies. They may encourage firms to make changes to boards or management so that their full potential can be reached. It will be run by Acuity Capital partners Judith MacKenzie and Nicholas Ross.
MacKenzie previously spent seven years at Aberdeen Asset Management where she ran Aim, private technology and media investments for the Aberdeen VCT’s she co-managed.
Ross joined Electra Partners in 1993 and was responsible for the EQMC pan-European fund and the Acuity VCTs when they were branded Electra Kingsway.
The attraction of the new fund is its ability to pick up good smaller businesses at bargain prices in the current economic environment. Smaller companies are more sensitive to the UK economy than bigger companeis that are influenced by global factors, so they are perfectly poised for a recovery.
However, opinion is mixed on whether the UK is starting to recover or whether the markets are experiencing a bear market rally and this uncertainty could mean investors are in for a bumpy ride until a recovery is fully underway.