UK government backs &€8364;16m venture capital fund set up in North

A £10 million sterling (&€8364;16 million) venture capital fund financed by the British government and private sector sources has been introduced to Northern Ireland - almost two years later than expected.

The Viridian Growth Fund, presented in 1999 as part of an economic aid package devised for the North by the British Chancellor of the Exchequer, Mr Gordon Brown, was launched yesterday by Sir Reg Empey, Minister for Enterprise, Trade and Investment in Northern Ireland.

The government-backed fund was established with more than £6 million of public money, including support from the European Investment Bank, and £3.3 million of private sector finance from Viridian and Abbey National.

The fund aims to provide finance for new and existing small to medium-sized businesses in the North, particularly in the high-tech and IT sectors.

But its introduction was delayed because the European Commission had concerns that the Viridian Growth Fund would fall foul of strict guidelines regulating the allocation of state aid.

After a 10-month inquiry, several amendments were made to the fund and the Commission recently ruled that it would not affect the balance of European Union trading conditions.

Sir Reg believes the fund will meet a gap in the North's funding market and is confident it will not compete with existing sources of finance from the commercial and venture capital sectors in Northern Ireland.

"Venture capital is an essential ingredient in the promotion of enterprise in the economy.

"The Viridian Growth Fund, through focusing on the smaller end of the equity spectrum, will meet the needs of small to medium-sized enterprises, which are the backbone of the Northern Ireland economy," Sir Reg said.

The department of Enterprise, Trade and Investment anticipates that up to 50 companies should have access to the fund over the next three years, which it estimates could help create and support 1,500 jobs in the North.

The fund's target sector will be firms in the manufacturing and tradeable services sector, such as IT firms that want to raise £50,000 to £300,000 of capital venture finance.

The Viridian Growth Fund, to be managed by Dr Alan Mawson from Clarendon Fund Managers, will provide finance in the form of loans and a small amount of equity capital to companies in the North and will have a 10-year lifespan.

Sir Reg has said another objective of the fund will be to encourage and create an enterprise culture in Northern Ireland.

"The growth fund will not be a passive investor.

"The fund, through its vast reservoir of expertise and linkages with other companies and business support organisations, will act not just as a source of funding but as a catalyst in the development of its trustee companies," Sir Reg added.

Meanwhile, in west Belfast yesterday, a subsidiary of Belgian group Fortis International Financial announced plans to create an additional 100 jobs at its Northern Ireland call centre.

Insurance Advisory Services, which employs 227 people at is call centre in Springvale, hopes to recruit 100 additional employees by the end of this year.