Ingenious Broadcasting EIS
Ingenious Broadcasting EIS has a focus on high-quality television content. Launched in 2005, Ingenious Broadcasting has backed TV programmes including The Frankenstein Chronicles, Dr Foster and Teletubbies. It has raised over £450 million for 150 television production companies to date.
- Media EIS
investing in television projects
protection provided by pre-sales receipts, TV tax incentives and other revenue
- Target annual
return of 7% to 14% (not guaranteed)
is one of the largest and most experienced fund managers in UK creative and
- Exit expected
in 3½–4½ years (not guaranteed)
Ingenious Broadcasting invests in companies producing high quality television projects. It seeks to achieve returns which balance risk management with the potential for growth on distribution of the projects.
The fund is operated on a discretionary management basis and invests in companies that develop and produce of commercially viable television content with significant international appeal. The investee companies are often set up specifically to do this.
Risk is diversified through multiple projects. They investee companies aims to generate fees for developing and producing television projects, as well as negotiate a share in any profits generated. Each investee company will be required to acquire all necessary rights to enable it to produce and exploit its television content.
Risk on the production expenditure is mitigated by getting pre-sale receipts and television tax incentive benefits – please note that tax treatment is subject to change. In addition, investee companies will take out insurance policies out and completion bonds to protect against normal industry risk (e.g. key talent becoming incapacitated).
Once a project is finished, which is expected to take 6 to 15 months, Ingenious anticipates the investee companies will develop their businesses by undertaking further projects.
The envisaged exit route is a realisation of qualifying shares in each company, the proceeds of which will be paid out to investors after 3½ to 4½ years. Exit is not guaranteed.
The manager is Ingenious Media, which is part of Ingenious Capital Management Limited.
Its senior team has a range of private equity investment experience, legal expertise and in-depth industry knowledge. It has unrivalled industry connections. Key staff include:
- Patrick McKenna – founder of the Ingenious Group and previously a partner at Deloitte where he headed up their Media division. Patrick is the chairman of several companies in the sector including award-winning television company Hat Trick Productions. He is a Fellow of the RSA and a member of BAFTA.
- Neil Forster – CEO of Ingenious Capital Management. Previous roles include Group Finance Director at Hat Trick Productions, and Head of Finance for the EMEA sales arm of Walt Disney’s television business.
Ingenious Broadcasting targets an annual return of 7% to 14% (not guaranteed). This is after EIS tax relief and net of all fees paid to the manager. Capital is at risk.
The usual risks with unquoted companies apply to this EIS offer. For instance, EIS investments are illiquid and capital is at risk. Investors should only invest money they can afford to lose. The value of tax relief depends on circumstances and tax rules could change. In addition, risks associated with this particular EIS include:
Operating risk – projects may not be as successful as the team expects.
Counterparty risk – if the presales counterparties went out of business the fund would need to find replacements to maintain collateral and security of pre-agreed sales.
Management – the success of the fund is down to the team. It needs to commit enough time and focus to ensuring the investment strategy is executed.
Tax risk – tax rules can change. EIS schemes have come under Treasury review recently. A change to EIS tax rules could make this investment less attractive. Tax benefits will depend on individual circumstances.
Fees will be charged by the manager to the investee company so there are no fees charged direct to the investor, meaning more of the subscription should benefit from tax relief. There is an initial fee of 6.5% (which includes an arrangement fee of 1.5% and an initial monitoring fee of 5%) and an annual monitoring fee of 1.5%. The annual depositary fee will be around 0.075% of the net asset value of the shares, and there will be a custodian fees of £25 per investor plus 0.1% per annum will be also be levied.
There are separate administration and transaction fees levied on the investee companies. Please see the Information Memorandum for further details on fees.
Key Information Document: Important Notice to Investors
Before you apply you should read and understand the important documents. Please note, the Key Information Document is not currently available for this investment. This is a new document we are required to provide to retail investors before they invest.
If you wish to apply now, please read the other important documents and ensure you are comfortable with the risks of investing. Then simply download, sign and return the declaration below alongside your application form and we will send you the document as soon as it is available.
This offer provides good exposure to a range of high quality TV projects. Ingenious is one of the biggest names in the industry – chances are you will see them on credits at the end of many TV programmes. Ingenious has an impressive track record in this area, although you should note past performance is not a guide to the future.
Ingenious is involved in a long-running dispute with HMRC over some of its legacy film tax schemes. Recently, HMRC reportedly issued an order for investors to pay back millions of pounds in taxes. The issues relate to film production companies that we understand are unconnected to Ingenious’ current EIS and IHT offers.
Wealth Club aims to highlight investments we believe have merit, but you should form your own view. You should decide based on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice or a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination. 08.12.2017
- Target return
- 7% to 14% pa
- Funds raised / sought
- Minimum investment