Ingenious Greenlight Media EIS
This offer is now closed
There are still several other EIS funds available to invest in this tax year:
Ingenious Greenlight Media EIS offers an opportunity to invest in a portfolio of companies that make and sell high-quality films and television programmes, similar to Shelley Media EIS. The main difference between the two portfolios is that Greenlight will pursue a blended investment strategy and fund higher-risk, higher potential reward projects in which Shelley Media might face restrictions due to its investment mandate. This means investors take more risk, but have greater opportunity to participate in the profits of the project if successful. Recent Greenlight film projects include Suffragette, Viceroy’s House and A United Kingdom.
- Media EIS investing in TV and film projects
- Some downside
protection through pre-sales, production insurance and completion bonds
- Target annual
returns of between 2.4% and 30% after EIS tax relief (not guaranteed)
- Ingenious is
one of the largest and most experienced fund managers in UK film industry
- Exit expected
in 3½–4½ years (not guaranteed)
The British Film Institute reports the UK film industry directly contributed £5.2 billion to the UK’s Gross Domestic Product in 2015. The UK government supports the industry by providing film production tax credits to make the country an attractive location for international rights owners. Every £1 given in film tax relief generates £12 for the economy.
The manager, Ingenious Media, has raised and deployed over £8 billion in the UK film industry over the last 19 years.
This is a higher risk offer than its sister portfolio Ingenious Shelley Media, but does offer more upside potential if the businesses are successful – there are of course no guarantees.
The greater part of an investor’s capital will be invested in production companies with the benefit of substantial distributor pre-sales, applicable tax incentives and/or other government subsidies or strong sales estimates provided by first class international sales agents to secure downside protection.
The remainder will target more performance-driven opportunities with the potential for uncapped upside. Here, investment will be made only in companies which have secured worldwide representation for their productions from either a major studio or top tier sales and/or distribution company.
Target return and strategy
Greenlight targets an annual return of 2.4% to over 30% (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 5.5% through Wealth Club (a saving of 1% on the full charge of 6.5%). The full initial fee is made up of an arrangement fee of 1.5% and an initial monitoring fee of 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 fee per investor plus 0.1% per annum will be also be levied.
There is a 25% performance fee on realised amounts in excess of 110% of the gross investment. So, for example, if £1.20 was delivered the manager would receive 25% of the 10p surplus.
There are separate administration and transaction fees levied on the investee companies. Please see the provider documents, including the Key Information Document, for more details on fees.
Ingenious has an impressive track record of investing in this industry. This is a higher risk offer than the Ingenious Shelly Media EIS, and could be considered by those interested in a broad media EIS portfolio wishing to take more risk in exchange for higher potential returns.
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
- Funds raised / sought
- Minimum investment
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