New €150million Government scheme to support growing Irish companies and create jobs launched by Minister Bruton
Minister issues call to Fund managers to invest in Development Capital Scheme at Action Plan for Jobs briefing in IFSC
The Minister for Jobs, Enterprise and Innovation, Richard Bruton T.D. today [Thursday] launched the €150million Development Capital Scheme and issued a call to Fund managers to signal their interest in establishing Funds to invest in Irish SMEs. The announcement was made at a briefing for the financial services community in the IFSC on the Action Plan for Jobs.
Under the new fund, the Government through Enterprise Ireland will invest a total of €50million in two Funds with the target of leveraging a further €100m from the private sector. The announcement of the call represents the delivery of a major commitment in Action Plan for Jobs 2012.
The Development Capital Scheme is aimed at addressing a funding gap for mid-sized, high-growth, Irish businesses with significant prospects for growth and job-creation. This Scheme will increase the availability of risk capital for Irish medium-sized enterprises engaged in manufacturing and technology, as well as high-growth trading services companies in Ireland – in specific sectors including engineering, food, life sciences, and electronics. The typical companies that are expected to benefit are in the range 60-160 employees.
This Scheme forms part of a suite of new measures being rolled out to improve access for credit as part of Action Plan for Jobs 2012:
- Micro-finance scheme for micro-enterprise
- Temporary partial loan guarantee scheme for SMEs
- Development Capital Scheme for mid-sized companies, primarily in traditional industries
- Innovation Fund Ireland for high-tech companies
Making the announcement at a briefing attended by members of the financial services community, Minister Bruton said:
“A key part of this Government’s plan for growth and job-creation is building a powerful engine of indigenous enterprise. Our ambition must not only be to attract the next Google or Microsoft to Ireland, but to develop and grow the next Google or Microsoft in Ireland
“Through the Action Plan for Jobs, we will implement a range of measures to ensure that indigenous businesses, which employ the large majority of people in this country, have access to the supports they need in order to start-up and grow in the way we need them to. One key aspect of this is access to finance – we must not only ensure that the banks restart lending in the normal way, but also implement a series of measures targeted at sectors with potential for high levels of employment growth.
“In Ireland, in contrast to many other countries, we have a shortage of large indigenous companies in manufacturing, technology and services. Mid-sized, high-growth Irish companies in these sectors often do not grow to their potential for various reasons – one of which is a lack of access to the right kind of finance. Ensuring that these companies can continue to grow and create jobs in Ireland is a crucial part of the Government’s job-creation strategy, and the €150million Development Capital Scheme will play a crucial role in this.
“By combining ambition with determined implementation, I am convinced that we can create the world-leading businesses of the future here, and create the employment opportunities we so badly need”.
Enterprise Ireland CEO Frank Ryan said:
“The Development Capital Fund provides a unique opportunity for Fund managers to receive a commitment from Enterprise Ireland to establish Funds to invest in manufacturing, technology and high growth trading services companies in Ireland. We have many vibrant companies with ambition to grow significantly. Indigenous industry is an essential contributor to economic prosperity and job creation and this fund will play a significant role in driving this growth activity”.
Enterprise Ireland will manage the Development Capital Fund and Fund managers have until 16 July 2012 to signal their interest. Further information can be found at www.developmentcapitalfund.com
For further information contact:
Note for Editors
The Action Plan for Jobs called for the design and launch of a new Development Capital Scheme, aimed at addressing a funding gap for mid-sized, high-growth, indigenous companies with significant prospects for job creation and growth.
The Government through Enterprise Ireland proposes to commit €50m to two Funds which should individually have no less than €75m in commitments. The target is therefore for the Government investment of €50m to leverage a minimum additional investment of €100m from the private sector.
These commitments will increase the availability of risk capital for Irish SMEs medium sized enterprises engaged in manufacturing, technology and high growth trading services companies in Ireland – in specific sectors including engineering, food, life sciences, and electronics. The typical companies that are expected to benefit are in the range 60-160 employees.
The Development Capital Fund is targeting Fund managers seeking to make investments of over €2m and up to €10m in Irish companies by way of equity or quasi-equity (debt taken on by a company with an equity component). Many of the investments will however likely be in the €2m - €5m range.
Enterprise Ireland is looking to commit to Irish Fund managers or international Fund managers wishing to establish a presence in the Irish market and fitting the following criteria.
- Growth investment experience in innovative SMEs
- A physical presence in the Irish market
- A track record with working alongside privately owned companies;
- A strong track record of working with companies to achieve strategic growth and development
- International syndication experience
- An intention to invest a minimum of double Enterprise Ireland’s commitment to any Fund in Irish manufacturing and high growth trading services companies
- Experience in raising capital