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Avanti Capital Limited (the “Company”)

Investing Policy
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Investment Objective

The Company’s investing policy is to pursue its objectives through two complementary activities.

• Its investment operation, which acquires interests in technology and trading businesses; and
• Its consultancy operation, which offers a business development service, to develop the investee business until an exit opportunity arises.

The Company’s current intention is not to invest in any new investments but to support its existing investment portfolio.

Assets or Companies in which the Company can invest

The companies in which the Company can invest are in technology and trading businesses.

In October 2006, the Company announced that it would not make any new investments, but would instead concentrate on maximising the value of the investments currently held.

Means by which the Investing Policy will be achieved

The Company’s investment objective is to pursue its policy of maximising the value of its investments and, at the appropriate time, to realise such investments. The Company also, where appropriate, provides financial support to the existing portfolio.

Whether investments will be active or passive investments

Investments in portfolio companies can be either active or passive.

The Investment Manager formally monitors the Company’s investments on an ongoing basis. The Investment Manager provides a business development service, to develop the investee business until an exit opportunity arises.

Holding period for investments

As the Company has no fixed life, no time limits are set as a matter of investing policy generally and individual holding periods will vary to achieve the best value from each investment.

Spread of investments and maximum exposure limits

The Company’s strategy is not to set maximum exposure limits per investment. However, as investments have been sold and monies returned to shareholders, the spread of investments has reduced and as a result the portfolio has become more concentrated.

Policy in relation to gearing

The Directors may exercise the powers of the Company to borrow money and to give security over its assets. The Company’s articles of association restrict the borrowings to an aggregate principal amount so that it does not, without shareholder approval, exceed the greater of (a) £5,000,000 or (b) an amount equal to three times the adjusted capital and reserves.

The Directors currently have no intention to exercise any borrowing powers.

Policy in relation to cross-holdings

The Company does not have a formal policy on cross-holdings.

Investing Restrictions

Whilst the Company’s current intention is not to invest in any new investments, this is not a formal restriction in the Company’s investing policy.

There are no restrictions on the ability of the Company to take controlling stakes in portfolio companies, but the Company ensures that there is sufficient separation between the Company and each portfolio company.

In addition, the Company also ensures that there is sufficient separation between each portfolio company by ensuring that there is no:

• cross-financing, including the provision of undertakings or security for borrowings from one portfolio company to another;
• common treasury functions; or
• sharing of operations.

Other than these restrictions set out above, and the requirement to invest in accordance with its investing policy, there are no other investing restrictions.

Returns and Distribution Policy

It is anticipated that returns from the Company’s investment portfolio will be in the form of capital upon realisation or sale of its investee companies.

When realisations are made, the Directors currently intend to use the proceeds to return monies to shareholders in the most efficient manner available.