Northern Powerhouse Fund nears £300m investment

The Northern Powerhouse Investment Fund (NPIF) announced it completed over 300 deals in 2021 with a value of £87 million “with an additional £145 million leveraged from the private sector.”

This brings the total number of deals completed since the NPIF’s inception in 2017 to 1,256, increasing from 956 deals in 2020.

It means the NPIF is approaching a £300 million investment milestone in the fourth year after its launch.

The NPIF said it has invested £295 million since 2017 in over a thousand businesses, with £382 million of funding leveraged from the private sector.

The NPIF provides micro finance, debt finance and equity finance options for businesses across the North of England.

The fund is operated by British Business Financial Services Limited, wholly owned by Sheffield-based British Business Bank, the UK’s national economic development bank.

The NPIF is supported financially by the European Union using funding from the European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020 and also supported by the European Investment Bank.

In 2021, NPIF fund managers completed 185 debt finance deals, worth nearly £40 million and micro finance fund managers completed 57 loans at a value of £4 million.

Support for organisations through equity finance was also strong, with the NPIF delivering 58 equity finance deals this year, facilitating £30 million of investment through its equity fund managers Maven and Mercia.

“As 2021 comes to a close, the Fund approaches its £300m investment milestone in the fourth year after its launch ” said the NPIF.

“Since its launch in 2017, NPIF has invested £295m in over a thousand businesses, with £382m of funding leveraged from the private sector.

“Demand from businesses for vital growth funding is high so the Fund is expecting another strong year of deal activity and with the Chancellor announcing £660m of funding for a new fund to launch when NPIF is invested, Northern businesses will continue to have strong funding options for the future.

“This year has seen several notable investments across the North.

“This includes a £1.25m investment, part of a larger £3.25m funding round for RwHealth to set up a new clinical research team based across Manchester and Leeds.

“The investment from NPIF – Maven Equity Finance will enable the company to further strengthen its position in the healthcare sector.

“Other sizeable deals can be found in Bubo.AI, an artificial intelligence price analytics platform.

“Based in Tees Valley, Bubo.AI received a £650,000 investment from NPIF – Mercia Equity Finance, helping to scale the businesses’ operations rapidly across Europe and North America.

“Foilco, a second-generation family business based in Warrington, also secured a £750,000 loan through NPIF – FW Capital Debt Finance this year.

“The specialist printers of stamping foil supply high quality foil materials to customers in the food and drink, confectionery, cosmetics, and fashion industries.

“With the investment, Foilco was able to update their machinery, invest in new staff, and completely revamp their website with cutting-edge technology.”

British Business Bank senior investment manager Sean Hutchinson said: “Off the back of an extremely challenging year, NPIF has completed at least one deal every working day in 2021.

“As we look towards 2022 and how we can collectively build a stronger north, the power of accessible funding options for smaller businesses cannot be underplayed.

“The Northern Powerhouse Investment Fund will continue a central role in making that a reality, offering more than just finance, but support and guidance to some of the UK’s most exciting businesses.

“With the Chancellor pledging £660m for a successor Fund, we can expect many more businesses to grow and prosper and the North’s economy to fulfil its enormous potential.”