Northern Venture Trust share offer fully subscribed

Newcastle and Manchester-based private equity outfit, NVM’s Northern Venture Trust has raised £15m.

Northern 2 VCT and Northern 3 VCT have together raised over £11m out of their joint target of £35m.

Tim Levett, chairman of NVM Private Equity, commented: “We are delighted to report that over 1,000 people have invested in the Northern VCTs since we opened the offers six weeks ago. Launching over the summer period has proved extremely successful, allowing investors more time to apply.

“Our VCTs have launched 12 significant share offers over a 15 year period across various cycles in the UK economy, and all those who invested in these offers have benefitted from real growth in the value of their investment in addition to tax relief.”

Capacity still remains in Northern 2 VCT and Northern 3 VCT, with offers for subscription to raise up to £15 million and £20 million respectively. To date, Northern 2 VCT has raised over £6 million and Northern 3 VCT £5 million.

The estimated tax-free dividend yields for Northern 2 VCT and Northern 3 VCT are 9.2% and 7.4% per annum respectively (based on each VCT’s stated dividend policy and the initial offer price net of 30% income tax relief).

Tim continued: “Northern 2 VCT and Northern 3 VCT are both strong funds which co-invest alongside Northern Venture Trust, with 85% of investment portfolios being commonly held. Investors will gain immediate exposure to a portfolio of mature and diverse smaller UK companies with high growth potential.

“This year we have seen deal flow increase and expect further growth over the next three years. We are also building our investment team to take advantage of this growth.”

Existing shareholders will benefit from a 1.5% loyalty bonus for applications received before 30 September 2013. This will be followed by a long-tailed early bird discount of 1% between 1 October 2013 and 7 February 2014. New investors can take advantage of a 1% reduction in offer costs if they apply before 22 November 2013.

In order to provide shareholders with the opportunity to realise value after the initial five year holding period, the Northern VCTs have a policy of buying back their shares in the market at a 10% discount to the latest published net asset value, subject to certain conditions.

The share offers are promoted by VCT marketing specialists Downing LLP, who have been working with NVM in this role since 1999.

The key points of the offers:

• Closing dates: 4 April 2014 (for 2013/14 tax year) and 30 April 2014 (for 2014/15 tax year), unless fully subscribed earlier
• Offer size: £15 million for Northern 2 VCT and £20 million for Northern 3 VCT
• Offer price: Based on each fund’s NAV plus issue costs (see Illustrative yield per Offer Share table in Investor Guide www.nvm.co.uk/vctig2013 )
• Minimum investment: £6,000 (across both funds)
• Maximum investment: £200,000 (per tax year)