Chelverton new VCT offering

Coming soon

Oxford Technology 2 VCT plc is proposing a new generalist ‘B’ share class to be managed by Chelverton Asset Management. 

A £5 million offer for subscription is expected to be launched by early December. If the offer is successful, the VCT will be renamed Chelverton VCT plc following the first allotment of the new shares.

This is a similar arrangement to that used when Seneca Capital Partners entered the VCT market earlier this year by launching a new share class of the former Hygea vct.

Register your interest to be notified as soon as the offer opens

The VCT

Oxford Technology 2 VCT is the smallest of four VCTs managed by Oxford Technology Management (OTM). There are 9 investments remaining in its portfolio and a total net asset value of £1.62 million.

With such a small asset base, covering the fixed costs of a VCT is becoming uneconomic. A merger would impose additional costs, whereas a planned wind-up would crystallise capital gains sheltered by subscribers under previous VCT rules. Raising a new ‘B’ Share class under a new Investment Manager offers a way out of this dilemma for the existing VCT board and shareholders – the costs of the fund raise being met by the new Investment Manager.

The VCT board proposes to appoint Chelverton Asset Management Limited to manage this new share class, and to change the investment policy to a more generalist approach. For Chelverton, taking on an already established VCT will save them setup and board recruitment costs compared to launching a new VCT. 

The new manager, Chelverton

Chelverton is an independent asset management business, founded in 1998, with a specialist focus on smaller quoted UK equities and unquoted SMEs. It is majority owned by its 11 employees, 8 of whom are fund managers, with offices in Bath, Edinburgh and London.

Chelverton is a new name in VCTs although Richard Bucknell, Investment Director, has been involved with Baronsmead VCTs in a senior investment role. It is also an established manager of investment trusts – for example Chelverton Growth Trust plc, which focuses on quoted and AIM listed companies below £50 million market capitalisation and also invests in unquoted investments, and Chelverton UK Dividend Trust plc, which offers a small and mid cap income strategy. As well its fund and investment trust interests, Chelverton has also invested around £50m in a range of privately owned SMEs.

Two key people for the management of the VCT are David Horner, Managing Director, who has a 30 year track record in corporate finance. David set up Chelverton to provide the investment management for the investment trust now known as Chelverton Growth Trust plc; he was responsible for launching that company in May 1999 and is still its manager. Richard Bucknell, Investment Director, has led over 30 investments into smaller companies since 1998 and held senior investment management positions at firms including Barclays Ventures, Livingbridge (where he was a senior member of the team investing on behalf of the Baronsmead VCTs) and Catapult Venture Managers.

The offer

The proposed ‘B’ share offer is expected to open by early December 2018. It will seek to raise approximately £5 million, with an overallotment facility of around £5 million. 

There is expected to be an early bird discount until 22 March 2019, and existing Oxford Technology 2 VCT shareholders can expect to be able to subscribe for B shares at a discount.

After the shares are issued, Oxford Technology 2 VCT plc will be renamed “Chelverton VCT Plc”.

How to invest

Register your interest here to be notified as soon as offer documents are available.


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. 08.11.2018

The details

Type
Generalist
Target dividend
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Initial charge
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Initial saving via Wealth Club
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Net initial charge
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Annual rebate
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Funds raised / sought
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Deadline
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