Expanding for the future
Businesses are still demonstrating an appetite for growth, despite prolonged economic turbulence.Even the strongest of businesses have been cautious during the downturn, but a number are now demonstrating quiet confidence and starting to think about investing for the future.
Peter WrightFinance Wales’ investment director
£37 million invested in 2009 - 10
This growing confidence has been reflected in Finance Wales’
investment performance in 2009 - 10 when the company smashed its
£30 million investment target to invest £37 million in Welsh
businesses – a 42% increase on the previous year’s record.
"Finance Wales is doing more deals than ever, despite the trends
we’ve seen in the market. We completed 246 equity and debt
investments in 2009 - 10." Wright explains. "Launching our £150
million fund certainly helped, but the drive and ambition of Welsh
businesses played its part."
Investing to expand
Encouragingly, businesses are seizing emerging expansion
opportunities, whether through organic growth or strategic
acquisition. Many are working with their advisers and taking the
right practical steps to turn their plans into reality.
Expansion based on a well-constructed business plan can have a
dramatic impact on a business’s future growth, turning successful
businesses into market leaders.
Finance Wales recently invested a third round in Cardiff Marine in
a multi-million pound deal which will enable it to continue
re-developing its Cardiff site and expanding its marine service,
storage and supply centre.
Acquiring the upper hand
"Another trend we’ve noticed recently is the growing number of
acquisitions," Wright continues. "More Welsh
businesses are adopting ‘buy-and-build’ strategies as they refocus
their priorities and take advantage of some excellent opportunities
currently on offer."
In a deal funded by Finance Wales and Sir Roger Jones, ZooBiotic
recently acquired its German competitor, Biomonde, enabling it to
consolidate its IP as well as to penetrate the North American
market more effectively.
Growth capital is the key
"We’ve been seeing some excellent business plans recently,"
Wright concludes. "I’m pleased businesses are recognising the
important role growth capital can play and how the right funding
package can help businesses expand."
"Our annual investment level has increased for the fourth
consecutive year which means we are playing an even greater role in
helping Welsh businesses achieve their growth ambitions." Sian
Lloyd Jones, chief executive.