New Growth Fund opens for business
New £2.5 billion fund launched to provide funding for UK SMEs.
Vince Cable today helped launch the Business Growth Fund (BGF), which has been established to help Britain’s smaller and medium sized businesses with an annual turnover of around £10m to £100m.
It is an independent fund of up to £2.5 billion, backed by five of the UK’s main banking groups - Barclays, HSBC, Lloyds, RBS, and Standard Chartered - and working in collaboration with the British Bankers’ Association.
In Birmingham to mark the launch of the BGF, Business Secretary Vince Cable said:
“The Business Growth Fund is ready to make substantial equity investments into ambitious mid-cap British companies who are set to create the business success stories of the coming years.
“To see the fund ready to invest so quickly is greatly encouraging and I look forward to the first successful firms receiving funding.”
The BGF will invest approximately £2m and £10m per business in return for a minimum 10 per cent equity stake and a seat on the board for a BGF director. The Fund will provide long-term equity investment for those growing companies which today do not have access to this source of capital.
Dr. Cable added:
“Alongside new government support for exporters and commitments made by the banks to increase the credit available to businesses of all sizes, this private fund will provide crucial support to the firms generating the employment our economy needs.
“Good investing requires local connections to find and assess opportunities, so for the Fund to have a presence outside London - in both Birmingham and Edinburgh - is particularly heartening. British businesses must have access to the growth capital they need, wherever they are based.”