A fund aimed at providing growth capital for small and medium-sized (SME) UK companies has broken through the £1billion investment barrier.
The Business Growth Fund (BGF) pumped £11million into holiday park operator Coppergreen Developments, which has used the cash to buy Dundee-based Pipperdam Golf and Leisure Resort bringing it past the mark.
The news comes as a survey found that a third of UK businesses have abandoned investments worth £65.5billion amid uncertainty following the Brexit vote.
The YouGov poll, commissioned by Hitachi Capital and the Centre for Economics and Business Research (Cebr), found that 42% of large businesses had ditched investment plans, while 44% of medium sized businesses, and 32% of small enterprise had done the same.
BGF said it is on track to invest more than £370million this year, compared to £250million in 2015.
The firm has invested £127 million in 17 businesses across Scotland, including Keenan Recycling, optometrists Duncan and Todd, IT firm Inoapps, and remote operated vehicle (ROV) specialist Rovop in the north-east.
The company has not made further investments in the region this year so far.
Mike Sibson, investment director for Scotland at BGF said: “BGF has established itself as the leading provider of long-term capital in the UK. We are proud to have backed 17 great companies in Scotland – and we know that we have only just scratched the surface.
“While growing businesses will be affected in different ways and to varying degrees during the Brexit negotiations and beyond, our long-term approach means that we have no intention of slowing down our new activity or support for the companies we back.”
Nationally, BGF invested more than £100million in the third quarter of 2016, compared to £60million in the same quarter last year. According to high growth firm tracker, Beauhurst, BGF was the top institutional investor in the three months following the EU Referendum by number of deals completed, against a backdrop of an overall slowdown in investment activity.
Collectively, the businesses backed by BGF employ 25,000 people nationwide – a number which would make it the UK’s eighth largest private sector employer.
BGF, which was set up and backed by five UK banks, makes long-term investments in SMEs in return for a minority stake. The companies it backs are privately-owned or listed on AIM, and typically have revenues of between £5million and £100million.
