First State VCT ‘will honour applications’

The VCT made its first allotment of shares last week after having raised £4m in subscriptions since it began its offer period on February 10. The fund’s offer period is set to run until June 28.

Richard Jones, head of UK and European retail sales at First State, says that the group is confident in its ability to reach critical mass. “We are only a quarter of the way through our launch and our current run rate is £250,000 a day and growing,” he says.

“The first few weeks are about sending out information. Most of the subscriptions we have received have been in the last two to three weeks or so. If we had been open since October or November and raised only a couple of million, it would have been a different picture, but that is not the case,” adds Jones (pictured).

Jones says the First State VCT has also been supported by a large number of companies and received a good rating from those within the VCT market. “We have business coming in and promised for next year from a wide range of distribution companies. We have done the hard part of convincing the market that this is a trust they want to be involved in,” he says.

While the group had set £3m as its target in order to build a diversified portfolio, Jones says the venture capital trust will raise as much as it can, up to a maximum of £20m.

Several VCTs failed to reach their subscription targets and chose to withdraw from the market last week, including the MTM China VCT, UniVen – which had raised over £2m – and the Cavendish Aim VCT. The ProVen3 VCT also withdrew from the market a few weeks ago.

However, F&C Asset Management’s Baronsmead VCT C-share issue closed last week after having reached its subscription target of £22m. According to the group, the VCT has had to turn away more than £4m in subscriptions following its closing.