London & Scotland see most growth investment

Carmen Reichman
14 March 2013

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In 2012, the UKтs venture and growth capital scene was once again most active in London, where unquoteт data recorded 82 transactions with a combined value of ТЃ734m.

Although Scotland was the second most active with 31 deals, the region only achieved a 10th of London's value. London's market value was boosted by the £350m expansion deal for Topshop/Topman, from US-based private equity firm Leonard Green & Partners, which bought a 25% stake in the business.

Aside from London, the Eastern, South East and the West Midlands emerged as strong regions in 2012 with values of £333m, £260m and £185m respectively. The Eastern region was heavily influenced by its two large travel and leisure deals Center Parcs and Park Resorts Group.

As in the year before, the South East was boosted by the pharmaceuticals/biotech sector in 2012. The region recorded five of these deals worth £82m out of a total of 19 deals valued at £137m across the UK, claiming significant market share in terms of value. The North West was second strongest in this sector with £26m invested, although it recorded more deals than its southern counterpart.

The most noteworthy deals were the Lansdowne Partners-led £31.4m funding round for Oxford Nanopore Technologies Ltd, PsiOxus Therapeutics, which was sponsored by Imperial Innovations and others in a £22m round, and Oxford Immunotec, which received $28m from Imperial Innovations and a pool of venture capital firms.

Private equity firm Midven was instrumental in lifting the profile of the West Midlands having been involved in four of the region's 10 deals. Data also shows that the investor backed only one deal outside the region in 2012, PlayMob in London. West Midlands businesses AccurIC, Formology, Big Button Media and BeGo all made it into the investor's portfolio last year. The most prominent deal in the region was Investindustrial's €190m investment in car manufacturer Aston Martin. The firm bought a 37.5% stake in the company from Kuwaiti investment house Investment Dar.

Overall, venture capitalists concentrated on the sectors software & computer services and travel & leisure in 2012. Software & computer services, which recorded 51 deals with a total value of £204m, was particularly strongly represented in the capital. This marked a change from 2011 when the sector still saw strong activity in other regions, including the South East.