Pembroke VCT

Manager Overview: Oakley Investment Management

• Oakley Capital was founded in 2002 by consumer and retail entrepreneur Peter Dubens

• Part of the Oakley group of companies, which has €1.6bn AUM, and includes Oakley Capital Private Equity, a mid-market private equity investor

• Pembroke VCT was launched in 2013 by the founders of Oakley Capital to take advantage of the volume of high quality, smaller company investment opportunities Oakley encountered

• Total value of assets   £56.4m (31/08/18)

• Significant personal investment of £1.65m by Directors and Mangers of the VCT

• Strong pipeline in excess of   £4m, ready to be deployed into new business after the first allotment

• Invested £42.9m across 34 investments since 2013

Key Points:

• £20 million VCT top-up Offer – with £20 million overallotment facility

• Mature VCT portfolio of 29 private companies reflecting Pembroke’s specialism in Consumer Brands (health & fitness, fashion, media and tech, and hospitality)

• 5% discount to NAV share buyback facility

• Annual dividend target of 3 pence per share (dividend reinvestment scheme available)

All data unless otherwise stated as at 31/08/2018

Risks

VCTs are high-risk so should only form part of a balanced portfolio and you should not invest money you cannot afford to lose. They also tend to be illiquid and hard to sell and value. Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks. Tax rules can change and benefits depend on circumstances. VCTs can now only invest new money in growth capital deals. Management buyouts, replacement capital deals and investments in mature companies are no longer permitted. This results in considerably higher risks. As this VCT generally invests in earlier-stage deals, it is higher risk. In addition, it is likely returns could be lumpier. Lastly, as it is a relatively new VCT, investors might have to wait longer for returns, although there has been an early uplift in NAV already for existing investors -  note past performance is not a guide to the future. There are two share classes: ordinary and B ordinary shares. The interests of Ordinary Shareholders and B Ordinary Shareholders may not always be aligned although the VCT has a conflict of interest policy in place to manage this.

BFS View

This is a relatively new and small VCT, which still hasn't had the chance to prove itself. However, there are some encouraging signs. The portfolio includes a number of promising companies that seem poised to achieve significant exits, although there are no guarantees. Moreover, the smaller size could play in favour of investors: a single positive exit is more likely to have an impact than it would in larger portfolios. Pembroke's strategy is significantly different from any other current VCT offering and could, therefore, dovetail well with other offers. Firstly, it invests , although not exclusively, in the hospitality and retail sectors, which tend to be neglected by most other VCTs. So it could add diversification to an investor's established VCT portfolio. Secondly, Andrew Wolfson and the team's experience means they know first-hand what it takes to build a successful business. As a result, they tend to take a much more active role in their investee companies than some other VCT managers.