NVM in buyout from Aberdeen

Northern Venture Managers (NVM), the UK private equity firm, has gone independent following a buyout from Aberdeen Asset Management.

NVM, a leading provider of venture capital in the £1m to £10m range to UK companies, has been acquired from parent company Aberdeen Asset Management by its management team.

Managing director Alastair Conn and investment director Tim Levett led the buyout team. Funds managed by NVM include the Northern Investors investment trust and four venture capital trusts (VCTs): Northern Venture Trust, Northern 2 VCT, Northern 3 VCT and Northern AIM VCT

NVM was founded in 1988 and then acquired by Edinburgh Fund Managers (EFM) in June 2000. It became part of the Aberdeen group in October 2003, when Aberdeen made a successful bid for EFM. The deal means NVM is 100 per cent owned by its 20 employees in Newcastle upon Tyne, Reading and Edinburgh. The firm said all the staff would remain with the business following the deal.

The consideration for the deal comprised a pre-completion dividend of £620,000, a cash payment of £128,700 at completion, and a share – not exceeding £2.45m in aggregate – of NVM’s fund management revenues for the three years ending 31 December 2006.

Conn indicated the opportunity for the buyout arose from Aberdeen’s existing ownership of a private equity business in the form of Aberdeen Murray Johnstone Private Equity. “Aberdeen’s acquisition of EFM created a lot of uncertainty, as it already had a well established venture capital business of its own, so we are delighted to have secured our independent future through the buyout. We have had excellent support from the boards of all of our funds throughout the process,” he said.

Despite encountering what he described as ‘difficult market conditions’ over the last three years, Conn said NVM had increased its total funds under management from £90m to over £150m and had beaten its three-year revenue target set on joining the EFM group.