Schroder Ventures moves closer to autonomy

Schroders’ share in the carried interest on the venture capital company’s existing fund is down to 2 per cent out of 20 per cent.

Schroder Ventures saw out last year on a high note with its acquisition of DIY chain Homebase from J Sainsbury and is now moving closer to independence from its parent company Schroders, according to eFinancial News.

Just as Mercury Private Equity extracted itself from Merrill Lynch Investment Managers in December, so Schroder Ventures seems keen to become an evermore distinct operation. At present no plans of a complete separation have been declared.

The news service says that Schroders will only take a 7.5 per cent stake of carried interest in future funds. Schroders has gone from taking 75 per cent of profits to just ten per cent in the latest fund.

Schroder Ventures' own carried interest, from which Schroders takes its share, is approximately 20 per cent of the funds’ profits. Schroders share in the carry is down on the existing fund to 2 per cent out of this 20 per cent.

The private equity company has been in the news recently for its acquisition of a 71.2 per cent shareholding in Homebase, in a deal which valued the DIY chain at £750m and for its development with Schroder & Co, the private banking arm of Schroders, of a pan European private equity fund of funds.