Former property magnate Stephen Vernon and the State's Irish Strategic Investment Fund (ISIF) have backed a €7 million fundraising round by energy-saving lighting specialist UrbanVolt.
The company fits LED lights to industrial premises at no charge to the user, but gets paid by sharing the savings on their customers’ energy bills over five years.
It is understood that UrbanVolt has raised €7 million from new shareholders, who are taking a 35 per cent stake, to fund its continued expansion in the US and Europe.
Mr Vernon is taking 10 per cent of the business and UrbanVolt will appoint him chairman of its board. ISIF is understood to be taking the balance, making it the larger player in the company’s fundraising round. None of the parties involved would comment on the deal.
The Government established ISIF in the wake of the financial crisis to invest what remained of the old National Pension Reserve Fund in start-ups and other businesses likely to boost economic growth.
Mr Vernon founded and ran Green Property, best-known as owner of the Blanchardstown Shopping Centre, which it sold to investment fund Blackrock in 2016 for €1 billion. In 2013 he and Pat Gunne set up Dublin-listed Green Real Estate Investment Trust (Reit).
Green Reit sold its properties last year for €1.34 billion. Assets included offices such as One Molesworth Street and the Central Park complex in Dublin.
UrbanVolt will use the cash raised to fund continued growth in the US and Europe, where the Irish company has been trading for more than two years.
It has been particularly successful in Germany and the US and continues to recruit new customers in other territories.
Chief executive Kevin Maughan founded UrbanVolt five years ago with the idea of supplying energy-saving LED lightbulbs and equipment to small Irish businesses.
LED lights are expensive, so they involve a big upfront cost, but they cut electricity consumption by up to 80 per cent, allowing UrbanVolt and its customers to use the savings to pay for their installation over time.
However, the idea proved more popular with larger businesses, including multinational manufacturers with operations in the Republic, so the company now focuses more on these clients.
UrbanVolt began expanding in international markets at the beginning of 2018, aided in part by its existing relations with multinationals, some of which wanted to use its services in facilities outside the Republic.
Customers have included pharmaceutical giant Pfizer; medical equipment specialist Zimmer Biomet; and Cargotec, a Finnish group that makes cranes, forklifts and other equipment.