BGF targeting first investment in Irish SME after Ulster Bank backing

A UK venture capital firm that set up an Irish unit late last year has said it is targeting its first equity investment in a SME within months, as Ulster Bank became the latest lender to back the initiative.

BGF, which has invested in more than 220 UK-based firms since it was established in 2011 in the wake of the financial crisis, hired former IBI Corporate Finance executive Leo Casey last year to set up an Irish operation.

The company, which had previously lined up backing from AIB, Bank of Ireland and the Ireland Strategic Investment Fund (ISIF), said on Sunday that it has now signed up Ulster Bank as it eyes up to €250 million of long-term minority equity investments in Irish family-owned or entrepreneur-led businesses.

In Ireland, BGF will make initial investments of between €1 million and €10 million, with further funding available in subsequent rounds, into earlier-stage and established companies across every sector. The companies it backs will typically have revenues between €5 million and €100 million.

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“Since our launch in November we have built a highly professional team and have met with individual businesses and business advisers from across the country to outline our offering,” said Mr Casey. “We have met with a very positive reception and are confident of investment activity in the coming months.”

BGF has, prior to the launch of the Irish investment vehicle, invested in Renegade Spirits Ireland, a major new whiskey producer based in Waterford. BGF also previously invested in Dublin-based Escher Group, a provider of software solutions to the global post office market. In Northern Ireland, BGF has previously invested in waste management operative RiverRidge Recycling and family-owned housebuilder Braidwater Homes.

Unlike private equity firms, which typically seek a controlling stake in a business, and an exit within five to seven years, BGF’s so-called “patient capital” model permits long-term investments.