FUNDING Circle’s listed fund has doubled in size, thanks to a share placing that raised £142m.
The Funding Circle SME Income Fund, which is quoted on the main market of the London Stock Exchange, launched the fundraising last month to purchase investments originated by the peer-to-peer business lender and boost its working capital.
It announced on Friday the successful placing of 142 million conversion (C) shares, which will be converted into ordinary shares within nine months. Selling ordinary shares risks reducing existing shareholder holdings, while a C share provides a separate class that can be merged at a later date.
“We are delighted with the very positive response to this issue, which will almost double the size of the company to in excess of £300m,” said Richard Boleat, chairman of the fund.
“This success is a strong endorsement of the company’s performance to date, where we continue to achieve stable returns for our shareholders. We are excited to make further loans to small businesses in the UK, US and Continental Europe on behalf of new and existing investors.”
The trust was launched in November 2015 and invests in loans on the Funding Circle platform. It issued a new prospectus in February as it plans to issue up to 500 million new shares over the next 12 months.
“This remains the only fund that lends exclusively to small businesses through a direct lending platform, opening up small business lending to investors who were previously unable to gain exposure to these loans,” said Samir Desai, director of the fund and chief executive of Funding Circle.
“This and the fact there are zero management or performance fees make it a differentiated and attractive product for investors, and we are very pleased this has been reflected in the take-up.”
Stockbroker and adviser Numis is acting as sole global co-ordinator, bookrunner and sponsor on the transaction.
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