ALLIANCE Fund Managers has issued redundancy notices to a number of its staff.
The Pier Head-based firm is seeking to make about eight redundancies, following its failure to clinch a contract to oversee the region’s next round of publicly funded venture capital investment cash for small and medium-sized businesses.
AFM has managed funds for Merseyside Special Investment Fund, which has been investing public and private sector cash in local firms since it was set up in 1996 as part of Europe’s Objective 1 regeneration programme.
AFM had been hoping to win the contract to manage the whole of the Northwest Development Agency’s Transitional Venture Capital and Loan Fund, but has secured just the loan fund element of the scheme. It has been told it will not manage the equity investment side of the scheme, though a decision has yet to be taken about who will.
The chairman of MSIF, the parent company of AFM, Michael Hulme said: “Due to the significant delay and uncertainty regarding the main North West Venture Capital Loan Fund, it has become impossible for AFM to keep its investment teams at current levels, and this unfortunately means we will have to start a consultation process with some staff.
“We will be ensuring we are fully staffed to manage the current loan element of the transitional funding and to seek out fresh opportunities as they present themselves.”
Prof Hulme added: “Since MSIF was set up in 1996, £125m has been invested in 1,289 businesses, 6,451 jobs have been created and a further 5,261 preserved. £240m private sector leverage has been brought into the region alongside these investments. This is a tremendous outcome from a complete start-up.
“While we are very pleased to have been awarded the Transitional Loan Fund for the North West, we are naturally very disappointed that AFM has not been appointed as fund manager for the entire suite of interim funds given the success of the MSIF funds.”
Prof Hulme said some staff will also be retained to manage MSIF’s existing investment portfolio over the next five years to ensure maximum returns.
“It is our intention to ensure MSIF is able to deliver continuity of investment over the longer term for Merseyside and to endeavour to build on our success in winning the Transitional Loan Fund further afield,” he said.
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