TVC Holdings exit not exactly a major shock

The directors of TVC Holdings haven’t completely killed it off just yet, but the investment company is now officially on death row and ready to meet its maker.

Seven years after floating the old Trinity Venture Capital group, Shane Reihill, its gregarious executive chairman, announced yesterday it was unable to find any profitable deals in Ireland and so it has decided to fold up its tent.

About 90 per cent of its assets, comprising €91 million in cash and shares in UTV, will be distributed to TVC shareholders in July. Reihill controls about 30 per cent of the equity, so is in line for a chunky pay day.

Coup de grace

The coup de grace will be delivered in “a number of years”, when

it exits its 24 per cent stake in the banking software company CR2, which makes up the remaining 10 per cent of TVC’s assets.

Its exit is not exactly a major shock.

Apart from the investments it had already made prior to its flotation, TVC completed just two new deals in the seven years since: investments in the hotel company Dalata and in UTV Media. Venture capitalists are understandably choosy where they invest their cash, but it always seemed to outsiders as if TVC just couldn't make up its mind what to do at all.

Profit for backers

Still, Reihill has made a profit for his backers. Job done, he could argue with plenty of justification.

His explanation yesterday for why TVC has chosen to quit now, however, is worthy of further examination.

Reihill suggested the wall of foreign capital that has washed over the Irish economy in the hunt for distressed assets has queered the pitch. He said there was “too much capital” chasing deals, and TVC could not find suitable investments that would make it an acceptable profit.

“We cannot find what we believe are value-enhancing opportunities,” he said. “A lot of capital has been put to work, and asset prices have risen significantly.”

Too much money washing around Ireland? Now that’s not a bad problem to have.