Foresight Group, an independent infrastructure and private equity investment manager, has acquired the technology ventures division of Downing.
The transaction covers the investment mandates of Downing ONE venture capital trusts (VCT), Downing FOUR VCT and Downing Ventures EIS Scheme.
The consideration for the deal includes an initial payment of around £13.6m and a further consideration of up to £4.2m payable over three-years, subject to meeting certain criteria.
As part of the deal, Foresight has also signed a capped fee sharing arrangement in connection with future performance and other fees.
These acquired funds have combined assets under management (AUM) of £275m deployed across venture capital, AIM-quoted investment companies and legacy asset-backed investment debts in the UK, the US and Israel.
They are said to be complementary to Foresight’s private equity funds and will boost its private equity AUM to £1.2bn.
Furthermore, the acquisition will enhance Foresight’s offerings with the addition of earlier stage venture investments with thematic focuses on enterprise software, deep technology and consumer.
Foresight Group executive chairman Bernard Fairman that the Downing’s VCT and EIS businesses are an excellent strategic fit for Foresight.
Fairman commented: “We are investing in multi-stage, fast growing, scalable businesses with the potential to generate significant returns. The additional capabilities will deepen our retail investor offering and provide further opportunities for our extensive retail sales team to drive growth.
“We said at the time of our IPO that M&A would be a core part of our growth strategy and I am delighted that we are successfully delivering on that promise. This transaction represents a significant strategic step, taking Group AUM to over £9bn and private equity AUM to £1.2bn today, while also providing us with a broader set of funds and capabilities.”
In 2020, Foresight acquired Pensions Infrastructure Platform to strengthen its sustainability capabilities.