UK - Matrix launches new VCT fundraising

MIG 2 will invest alongside Matrix's four other Income & Growth VCTs. The fund has a minimum investment of £5,000 and has currently raised £8.3m, with a target of £18.3-23.3m.

The fund focuses exclusively on management buyouts and Matrix believes that the year ahead will provide attractive buying opportunites that have the potential to generate superior returns, as seen during previous post-downturn vintages. However, there are fears in the market that despite this assertion VCTs may struggle to raise capital in 2009, as they are restricted to investments in small UK businesses, which are perceived as more risky.

On the other hand, many highlight the fact that VCTs offer a 30% up-front tax break as well as tax free dividends, which obviously boosts returns for investors notwithstanding an anticipated slowdown in performance. Indeed, Mark Wignall, managing director at Matrix, believes VCT managers should be making the most of this fact to attract investors: "The industry has to be a little less coy about the advantages of the product in terms of tax than it has been in the past."

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• Topics
• Buyout
• UK / Ireland