New fundraising record for investment companies already reached in 2021

Fundraising by existing companies this year tops the previous 2019 record for secondary fundraising.

fundraising increase

Fundraising by existing investment companies (known as secondary fundraising) has bounced back strongly this year, with £8.71 billion raised so far.1

This already exceeds the previous record for secondary fundraising, which was set in 2019 with £7.35 billion raised over the whole calendar year.

Fundraising by existing companies has been led by the Renewable Energy Infrastructure sector, which raised £1.69 billion. This was followed by Infrastructure (raising £988 million), Growth Capital (£803 million) and Property – Europe (£556 million).

The largest individual secondary fundraising was by Schiehallion (£503 million), followed by Digital 9 Infrastructure, which raised £300 million in its IPO in March then went on to raise a further £450 million.

There were nine IPOs up to 4 October raising £2.08 billion, which already exceeds the funds raised by IPOs in both 2019 and 2020.

Richard Stone, Chief Executive of the Association of Investment Companies (AIC), said: “Healthy fundraising by investment companies this year is a sign that they have bounced back from the pandemic and are continuing to meet investors’ needs.

“It’s particularly encouraging to see such significant fundraising for long-term assets in areas such as renewable energy infrastructure and ambitious growth companies. Directing capital into these areas is critical to rebuilding the economy as the recovery from the pandemic gathers pace. There is clearly strong investor demand and the closed-ended structure of investment companies continues to provide investors with a proven means of gaining exposure to less liquid assets.”

Top sectors for secondary fundraising (fundraising by existing investment companies)

AIC sector

Amount raised by existing investment companies (£m)

Renewable Energy Infrastructure

1,688

Infrastructure

988

Growth Capital

803

Property – Europe

556

Global Smaller Companies

555

Flexible Investment

513

Property – UK Commercial

424

Property – UK Logistics

408

Property – UK Residential

405

Royalties

306

Source: AIC/Morningstar (as of 04/10/21). Excludes VCTs.

 

Investment companies raising highest amounts through secondary fundraising

Investment company

AIC sector

Amount raised through secondary fundraising (£m)

Schiehallion

Growth Capital

503

Digital 9 Infrastructure

Infrastructure

450

Renewables Infrastructure Group

Renewable Energy Infrastructure

440

Smithson

Global Smaller Companies

424

Tritax Eurobox

Property – Europe

412

SDCL Energy Efficiency Income

Renewable Energy Infrastructure

410

Home REIT

Property – UK Residential

350

Chrysalis Investments

Growth Capital

300

Tritax Big Box REIT

Property – UK Logistics

300

Hipgnosis Songs

Royalties

241

Source: AIC/Morningstar (as of 04/10/21). Excludes VCTs.

 

- ENDS -

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Notes to editors

  1. Secondary fundraising figures are from 1 January to 4 October 2021. Secondary fundraising is by existing investment companies. Closed issues admitted to trading only. Excludes VCTs and shares reissued from treasury. Source: AIC/Morningstar.
  2. The Association of Investment Companies (AIC) was founded in 1932 to represent the interests of the investment trust industry – the oldest form of collective investment. Today, the AIC represents a broad range of closed-ended investment companies, incorporating investment trusts and other closed-ended investment companies and VCTs. The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s mission statement is to help members add value for shareholders over the longer term. The AIC has 364 members and the industry has total assets of approximately £259 billion.
  3. Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
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