- Unprecedented demand sees the UK’s largest VCT meet initial fundraising target in just four months
- Use of £80 million over allotment facility increases fundraising target to £200 million
Octopus Investments, part of the Octopus Group and the largest provider of venture capital trusts (‘VCTs’) in the UK[1], today announced, following Titan VCT Board approval, that the £80 million over allotment facility will be used in its current fundraise for the UK’s largest VCT, Octopus Titan VCT, after investor demand has taken the total fundraising amount to record-breaking levels.
Octopus Titan VCT rapidly reached its initial target of £120 million within just four months and is now offering an additional £80 million of fundraising capacity to meet investor demand ahead of tax year end. The target of £200 million will be the largest ever fundraise by a VCT and, once fully subscribed, would increase the total fund size to over £600 million.
Octopus Titan VCT offers investors comfortable with the risks of smaller company investing, attractive tax incentives and access to a well-established and diverse portfolio of around 50 smaller companies. Since it launched in 2007 it has focused on backing talented entrepreneurs and innovative companies with the potential and ambition to make an impact on the global stage. These range from very early stage businesses, such as the retail property marketplace company Appear Here, to well-known household names including Secret Escapes, the members-only holiday company.
Paul Latham, Managing Director at Octopus Investments, said:
“With investors facing increased taxation on both their pensions and property, the rise in inflows into VCTs is not surprising. More and more people are looking at alternative tax-efficient investment options to support their retirement planning. There has been a steady growth in demand for VCTs over the last few years as more advisers and investors gain awareness of the attractive benefits they offer. Today’s news is evidence of investor confidence in VCTs as a powerful planning tool and an increasingly mainstream investment option for many.”
[1] Source: The Association of Investment Companies, April 2017
Jo Oliver, fund manager of Octopus Titan VCT, commented:
“As well as the attractive tax benefits, people are increasingly interested in playing a role in supporting the next generation of UK businesses. In November, the Chancellor highlighted early stage companies as the backbone of the UK economy in his Autumn Budget, as well as recognising the vital part VCTs play in helping to develop these businesses. The UK is a vibrant market for entrepreneurial activity and there is a thriving pipeline of investment opportunities. We’re excited to be able to offer more investors access to the growth potential that these dynamic young companies can offer.”
VCTs offer investors up to 30% upfront income tax relief providing that shares in the VCT are held for at least five years, as well as tax-free dividends and tax-free growth. Titan has an impressive track record of paying dividends, having announced total dividends of 66p per share to investors since it was first launched.
The share offer is open until 4 September 2018 but may close earlier. The minimum investment is £3,000 while the maximum investment qualifying for tax relief is £200,000.
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Notes to Editors
About Venture Capital Trusts
Venture capital trusts (VCTs) were introduced by the government in 1995 to encourage much-needed investment into smaller companies, driving job creation and economic growth in the process. They offer a number of tax incentives for those investors comfortable with the associated risks of smaller company investments, including up to 30% upfront income tax relief providing that shares in the VCT are held for at least five years, as well as tax-free dividends and tax-free growth. While these incentives are subject to certain HMRC legislation and personal circumstances they remain very attractive for those willing to put their capital at risk through investing in a VCT.
Dividends
Octopus Titan VCT aims to pay regular tax-free dividends of at least 5p per share annually, as well as offering investors the potential for special dividends if portfolio companies are sold at a significant profit. Since its launch in 2007, it has announced total dividends of 66p per share to investors. While profits are usually paid out to investors as tax-free dividends, if the shares do rise in value, there’s also no capital gains tax to pay when you eventually choose to sell them. Past performance is not a reliable indicator of future results.
Five-year performance
| 30/04/2013 | 30/04/2014 | 30/04/2015 | 30/04/2016 | 30/04/2017 | |
| Annual total return | 33.8% | 9.6% | 11.4% | 7.2% | 4.7% |
| Annual dividend yield | 38.3% | 5.6% | 5.4% | 9.2% | 5.2% |
Source: Octopus Investments, 30 April 2017
The performance information above shows the total return of Octopus Titan VCT for the last five years to 30 April, the VCT’s interim accounting period. The annual total return for Octopus Titan VCT is calculated from the movement in net asset value (NAV) over the year to 30 April, with any dividends paid over that year then added back.
For journalists in their professional capacity only. The value of an investment, and any income from it, can fall or rise. Investors may not get back the full amount they invest. Tax treatment depends on individual circumstances and may change in the future. Tax reliefs depend on the VCT maintaining its VCT-qualifying status. VCT shares could fall or rise in value more than other shares listed on the main market of the London Stock Exchange. They may also be harder to sell. Past performance is not a reliable indicator of future results. Personal opinions may change and should not be seen as advice or a recommendation. We do not offer investment or tax advice. We recommend investors seek professional advice before deciding to invest. This advertisement is not a prospectus. Investors should only subscribe for shares based on information in the prospectus, which can be obtained from octopusinvestments.com. Issued by Octopus Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 03942880. Issued: January 2018.