Investment Policy

The Baronsmead VCTs have established portfolios of unquoted, AIM-traded and other companies.

The Investment Policies of the Baronsmead VCTs

The Company’s investment policy is to invest primarily in a diverse portfolio of UK growth businesses, whether unquoted or traded on AIM, which are substantially based in the UK, although many of these investees may have some trade overseas.

Investments are made selectively across a range of sectors in companies that have the potential to grow and enhance their value and which will diversify the portfolio.

The company will make investments in accordance with the prevailing VCT legislation which places restrictions, inter alia, on the type and age of investee companies as well as the maximum amount of investment that such investee companies may receive.

Baronsmead Venture Trust

Investment securities
The Company invests in a range of securities including, but not limited to, ordinary and preference shares, loan stocks, convertible securities, and permitted non qualifying investments as well as cash. Unquoted investments are usually structured as a combination of ordinary shares and loan stocks or preference shares, while AIM-traded investments are primarily held in ordinary shares. No single investment may represent more than 15% (by VCT value) of the Company’s total investments.

Liquidity
Pending investment in VCT qualifying investments, the company’s cash and liquid funds are held in permitted non qualifying investments.

Investment style
Investments are selected in the expectation that the application of private equity disciplines including active management of the investments will enhance value and enable profits to be realised on the sale of investments.

Co-investment 
The Company typically invests alongside Baronsmead Second Venture Trust plc in companies sourced by Livingbridge VC LLP (“the Manager”).

The Manager’s members and staff invest in unquoted investments alongside the Company. This scheme is in line with current practice of private equity houses and its objective is to attract, recruit, retain and incentivise the Manager’s team and is made on terms which align the interests of shareholders and the Manager.

Borrowing powers
Should it be required the Company’s policy is to use borrowing for short term liquidity purposes only up to a maximum of 25 per cent. of the Company’s gross assets, as permitted by the Company’s articles of association.

Baronsmead Second Venture Trust

Investment securities
The Company invests in a range of securities including, but not limited to, ordinary and preference shares, loan stocks, convertible securities, and permitted non qualifying investments as well as cash. Unquoted investments are usually structured as a combination of ordinary shares and loan stocks or preference shares, while AIM-traded investments are primarily held in ordinary shares. No single investment may represent more than 15% (by VCT value) of the Company’s total investments.

Liquidity
Pending investment in VCT qualifying investments, the company’s cash and liquid funds are held in permitted non qualifying investments.

Investment style
Investments are selected in the expectation that the application of private equity disciplines including active management of the investments will enhance value and enable profits to be realised on the sale of investments.

Co-investment 
The Company typically invests alongside Baronsmead Venture Trust plc in companies sourced by Livingbridge VC LLP (“the Manager”).

The Manager’s members and staff invest in unquoted investments alongside the Company. This scheme is in line with current practice of private equity houses and its objective is to attract, recruit, retain and incentivise the Manager’s team and is made on terms which align the interests of shareholders and the Manager.

Borrowing powers
Should it be required the Company’s policy is to use borrowing for short term liquidity purposes only up to a maximum of 25 per cent. of the Company’s gross assets, as permitted by the Company’s articles of association.