THE man in charge of Merseyside Special Investment Fund says he wants to create a “3i for the North West.”
Speaking as the Northwest Development Agency (NWDA) issued a call for tenders to manage a £140m venture fund for the region, MSIF’s chief fund manager Mark Fuller said it was his dream to create a region-wide fund that could benefit from his team’s experience of running a similar fund for Merseyside.
However, Mr Fuller and his colleagues at fund managers AFM face a stiff challenge in the next few months as they bid for the contract to manage the new region-wide fund against rival bidders.
Fresh business investment cash from the North West’s latest round of European Union economic development money is to be made available for equity investments and business loans for small and medium sized firms.
Managed by AFM, MSIF has been doing exactly that for Merseyside for the past seven years. AFM currently manages £141m on behalf of MSIF.
Mr Fuller said: “My dream is to see AFM’s leadership and partnering approach taken out to the SMEs in the North West.
“It would be a 3i for the North West, but I would have to argue the finished product would have to be significantly better than what 3i used to be, but that is the easiest way to think about it.”
He argues that such a fund would have to be locally managed, saying big
national fund managers wouldn’t possess the necessary local knowledge to succeed.
However, MSIF’s latest accounts filed at Companies House show that weak investment performance continues to be a problem.
The most recently created equity fund, Venture Fund 3, has seen £19.5m invested in Merseyside SMEs, with £16.2m of that sum written off. The write-off charge rose £4.8m in the 12 months to March 2008.
Venture Fund 3 still has £3.3m of unimpaired investments that could yet grow in value to offset the losses incurred to date.
Every penny of the £5m invested in Venture Fund 2 has been written off. Established for 12 years, Venture Fund 1’s accounts show £10m has been invested by the equity partners and £9.3m of this has been written off.
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