BGF has reported strong deal flow in Scotland and Northern Ireland in the first half of 2022. Close to £25 million has been invested into growing businesses, while exit activity has delivered a 3.5x return off four exits.
BGF is a long-term patient investor, making initial investments between £1 million to £15 million for a minority equity stake. Deals completed to-date in 2022 by BGF’s Scotland and Northern Ireland team come from a range of sectors, including life sciences, technology, manufacturing and healthcare
Underlining BGF’s mission to inspire a generation of entrepreneurs largely overlooked or insufficiently supported by the investment community, the deals completed have a broad geographical spread across Scotland and two of the three businesses have female founders.
Since the turn of the year, the team has completed a £1.6 million investment in Inverness med-tech firm Aiber, while Glasgow-headquartered Scottish Dental Care received a multi-million-pound minority investment to implement its ambitious growth plans. In the Northeast of Scotland, BGF led an £8 million investment round into Aberdeen-based biopharmaceutical company Elasmogen, to support its development pipeline of next-generation drugs.
As BGF’s Scottish portfolio continues to mature, there have been four exits/partial exits in the first half of the year, with a combined enterprise value of over £260 million. These exits, which follow hold periods ranging from 18 months to nine years, have returned £63 million to BGF, on £18 million invested, representing a return on investment of 3.5x. This includes CSN Care Group, Inoapps, Aubin and a partial exit from Calnex.
” After a record 2021, where BGF’s Scotland and Northern Ireland team invested almost £60 million, it is particularly pleasing to see this momentum continued through a diverse range of significant deals. As businesses adapt to higher inflation and the lingering aftermath of the Covid-19 pandemic, our ability to deploy capital at scale, and the overall strength of our investment model continues to attract the type of ambitious companies we seek to support.”
Patrick Graham, BGF’s head of Scotland and Northern Ireland
“As well as new investments, we also recorded four successful Scottish exits, which serve as a reminder of the important journey we go on with our portfolio companies as they scale. Each exit marked a mutually beneficial next step following positive work between BGF and the investee company. Looking ahead, the pipeline for the remainder of the year is strong, with more new deals and further positive exits anticipated.”
BGF’s existing portfolio companies in Scotland have also continued to perform well in the first half of 2022. Dundee tech firm Waracle saw its sales increase by nearly £12 million, Paint Shed opened its eighteenth store in March – with another to follow in summer, and independent coffee and food chain Bob & Berts is set to open its sixth Scottish site at the end of July – similarly with further expansion expected to follow. More recently, Scottish Dental Care used BGF funding to assist with the acquisition of two well-regarded Edinburgh practices.
This news comes on the back of recently published annual results for BGF in the UK and Ireland, which marked a record-breaking year for the business as a whole in 2021. As well as maintaining its position as the most active investor in UK and Irish growth economy companies, BGF backed 67 new companies, investing a total of £600 million.
£165 million of this was follow-on funding to support further growth for portfolio companies, which is a key part of its longer term offer to entrepreneurs. Nationally, BGF exited investments in 39 businesses, delivering a total return of £571 million from exits in 2021 (up from £233m in 2020), a 2x money multiple and a 23.4% gross IRR.