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Expanding for the future

invest bulletin: issue 3, 2010

"Businesses are still demonstrating an appetite for growth, despite prolonged economic turbulence," says Peter Wright, Finance Wales’ investment director.

"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."

£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.

See our latest investment figures.

"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.

Find out more about Cardiff Marine Group.

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.

Find out more about ZooBiotic.

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.