RBDC Enters Irish Market with Joint Venture Fund

RBDC Enters Irish Market with Joint Venture Fund

Royal Bank Development Capital (RBDC) has linked with the Enterprise Ireland development agency and Corporate Finance Ireland (CFI) to launch a joint venture fund, Alliance Investment Capital, for investment in developing Irish companies. RBDC has committed GBP5 million to the fund alongside an initial IRGBP 2.5 million (euro 3.2 million) from Enterprise Ireland, provided under the European Union Seed and Venture Capital Measure; if Alliance proves successful, Enterprise Ireland may provide additional capital to match RBDC’s commitment pound for pound. CFI, an independently owned corporate finance house offering advice and fund-raising expertise to a wide range of Irish clients, will manage Alliance on a carry basis but is not an investor in the fund.

The Alliance project, which was launched in March, represents RBDC’s first move into the Irish market, where it aims to develop a significant presence. Commenting on the establishment of Alliance, RBDC managing director Joe McGrane said, “The Irish economy provides a model for successful growth and development and is an exciting business environment in which we want to be involved”.

Director Douglas Kearney, who together with assistant director David Calder will be responsible for RBDC’s Irish programme, said the firm has been keen to secure deal flow in Ireland for some time but has been waiting for an appropriate opportunity to emerge. “It is possible – although difficult – to parachute’ in and out of a market, but without an established local presence, there is a danger that you will be perceived as a fly-by-night'”, he explained. “RBDC has known Corporate Finance Ireland for some time and that relationship, together with the link with Enterprise Ireland, leaves us well positioned to address a range of opportunities in the Irish market”. RBDC already operates a successful joint venture partnership, Vista Inversiones, with Banco Santander in Spain and has also forged links with Siparex to access French development capital deals.

The Alliance fund will focus on established small to medium-sized companies across a broad range of sectors, with a particular emphasis on technology-based businesses, and will make investments in the IRGBP250,000 to IRGBP 1 million range.

Enterprise Ireland director Gerry Moloney said undercapitalisation is a key constraint to the competitiveness of many Irish companies. Accordingly, the development agency is committed to a policy of actively encouraging and supporting private sector equity providers. “In this context, we are pleased that a leading venture capital house from an EU member state which has both international and strong regional development experience has decided to support Irish SMEs. RBDC’s commitment to this joint venture represents both a strong vote of confidence in the ability of Irish industry to perform and in the Seed and Venture Capital Initiative”.