A new £25 million Welsh Government fund will provide ambitious Welsh managers and management teams with the funding they need to buy established Welsh small and medium-sized businesses (SMEs) when their current owners retire or sell up.
Launched by Economy Minister Edwina Hart, the 5-year Wales Management Succession Fund aims to help 20 Welsh SMEs create and safeguard over 1,000 jobs under new ownership.
Managed by Development Bank of Wales 5 – 7-year debt and equity investments of between £500,000 and £3 million will be available from the new fund.
Development Bank of Wales has already made succession investments totalling £42 million from its existing funds to help new owners buy 127 established Welsh SMEs and demand for this type of investment has increased in the last 3 years.
The Minister said:
“Established small and medium-sized businesses have skilled, loyal workforces and make a significant contribution to the Welsh economy. They have often traded successfully for many years and have the potential to achieve even greater success in future.
“With an increasing number of Welsh business owners looking to retire or sell their businesses, the Wales Management Succession Fund will provide aspiring new owners with the funding they need to buy these indigenous businesses and drive them on to even greater success.”
Welcoming the Minister’s announcement Giles Thorley, Development Bank of Wales’ new Chief Executive added:
“The Wales Management Succession Fund is yet another demonstration of the Welsh Government’s commitment to Welsh SMEs. Between 2012 and 2016 the Welsh Government has made over £120 million of growth finance available to Finance Wales to invest in a range of funding requirements.
“Development Bank of Wales can now provide ambitious Welsh managers and management teams with tailored funding packages to buy their own businesses. Established businesses can go from strength to strength with new owners at the helm, safeguarding the jobs of existing employees and going on to create new job opportunities as they grow.”
The continued success of established Welsh SMEs can be felt throughout the Welsh economy, positively impacting local supply chains and communities.
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