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The fund management team at Hargreave Hale has been managing the AIM VCT since 2004. To date, the VCT has rewarded investors with strong performance and an attractive tax-free dividend stream, in addition to the income tax relief available at the point of investment.


Launched in August 2004, Hargreave Hale AIM VCT plc merged with Hargreave Hale AIM VCT 2 plc on 23 March 2018. Between them, the two VCTs have raised over £192m (as at April 2019). Hargreave Hale has been the appointed investment manager and custodian of the company’s assets since inception.


The board has four experienced non-executive directors, including three that are independent of Hargreave Hale. Their duties include:

  • overseeing delivery of the investment strategy
  • monitoring compliance with VCT rules
  • maintaining corporate governance standards
  • producing reports and accounts for shareholders.

Following a career in corporate finance and venture capital, Aubrey assumed his first role within the VCT industry in 1997. Since then he has gone on to become one of the most experienced directors within the industry. Aubrey maintains a wide range of business interests and has been a director of six AIM listed companies. He is the senior independent director of Downing Four VCT plc.

An experienced company chairman in both private and public companies, and a former main board director of MFI Furniture Group plc, David joined the Board in September 2010. David is chairman of Primrose Ltd, Honest Brew Ltd, Episys Group Ltd and Elderstreet VCT plc and a non-executive director of Puma VCT 12 plc.

Oliver Bedford graduated from Durham University with a degree in Chemistry. He served in the British Army for 9 years before joining Hargreave Hale in 2004. Oliver is the Lead Manager of the VCT and supports other unit trusts as part of the fund management team.

Ashton Bradbury was appointed a director on 14 May 2018. He has previously held roles at Charterhouse Tilney, Hill Samuel Investment Management and HSBC Asset Management Europe and was, until 2014, a fund manager with Old Mutual Global Investors where he established its UK small and mid cap equities team. Ashton is currently a non-executive director of Standard Life UK Smaller Companies Trust PLC and is a director of Golf Union of Wales Limited.


5 September 2019

Ticker HHV
Launch Date September 2004
Year End September
Share Price (05.09.19) 66.00p
NAV per share 69.97p
Last Div. Paid (26.07.19) 1.50p
Next Div.  N/A
Total Divs. Paid 55.15p
NAV Yield (30.09.18) 5.02%
Discount to NAV (05.09.19) 5.67%
Number of Shares 204,468,758
Market Cap £134.9m
Charges (AMC) 1.70%
Ongoing Expenses 2.02%
SEDOL Number B02WHS0
ISIN Number GB00B02WHS05

Investment Objectives

The company’s investment objectives are:

  • to invest in a diversified portfolio of small UK based companies on a high risk, medium term capital growth basis, primarily being companies which are traded on AIM and which have the opportunity for significant value appreciation;
  • to invest in smaller companies which may not be readily accessible to private individuals and which also tend to be more risky;
  • to maximise distributions to shareholders from capital gains and income generated from the Company's funds; 
  • targeted investment in equities which are non-qualifying investments on an opportunistic basis; and
  • to maintain the Company’s exposure to small companies through an initial investment of new capital into the Marlborough Special Situations Fund pending investment into qualifying companies.

Investment Stratagy

Qualifying investments

The investment manager will maintain a diversified and fully invested portfolio of Qualifying Investments. The primary purpose of the investment strategy is to ensure the Company maintains its status as a VCT. To achieve this, the Company must have 70% (80% for accounting periods beginning on or after 6 April 2019) of all funds raised from the issue of shares invested in Qualifying Investments throughout accounting periods of the VCT beginning no later than three years after the date on which those shares are issued.

Although VCTs are required to invest and maintain a minimum of 70% (80% for accounting periods beginning on or after 6 April 2019) of their funds invested in Qualifying Investments as measured by the VCT rules, it is likely that the investment manager will target a higher threshold of approximately 80% (85% for accounting periods beginning on or after 6 April 2019) in order to provide some element of protection against an inadvertent breach of the VCT rules. The Company's maximum exposure to a single company is limited to 15% of net assets at cost.

The key selection criteria used in deciding which Qualifying Investments to make include, inter alia:

  • the strength and credibility of the management team;
  • the business plan;
  • the risk/reward profile of the investment opportunity;
  • the quality of the finance function and budgetary process;
  • the strength of the balance sheet relative to anticipated cash flow from operations; and
  • the existing balance of investments within the portfolio of Qualifying Investments.

The investment manager follows a stock specific, rather than sector specific, investment approach and is more likely to provide growth and development capital than seed capital.

The investment manager will primarily focus on investments in companies with a quotation on AIM. The investment manager will also invest in private companies or those planning to trade on AIM. The investment manager prefers to participate in secondary issues of companies with an established track record that can be more readily assessed and greater disclosure of financial performance. Secondary issues are often priced at an attractive discount to the market price.

Non-qualifying investments

The Company will have non-qualifying direct equity exposure to UK and international equities through targeted investments made on an opportunistic basis. This will vary in accordance with the investment manager's view of the equity markets and may fluctuate between nil and 30% (by market value) of the net assets of the Company. The investment manager will also invest in fixed income securities and cash.

The investment manager will invest up to 75% of the net proceeds of any issue of new shares into the Marlborough Special Situations Fund subject to a maximum of 20% (8.9% as at 30 September 2018) of the gross assets of the Company. This will enable the Company to maintain its exposure to small companies indirectly, whilst the investment manager identifies opportunities to invest directly into small UK companies through a suitable number of Qualifying Investments.

The allocation between asset classes in the non-qualifying portfolio will vary depending upon opportunities that arise with a maximum exposure of 100% of the non-qualifying portfolio to any individual asset class.

To the extent that any future changes to the Company’s investment policy are considered material, shareholder consent to such changes will be sought.

Risk Management

The structure of the company's investment portfolio and its investment strategies has been developed to mitigate risk where possible.

  • The company has a broad portfolio of investments to reduce stock-specific risk.
  • Flexible allocations to non-qualifying equities, the Marlborough Special Situations Fund, fixed interest securities and bank deposits allow the investment manager to adjust portfolio risk without compromising liquidity.
  • Regular company meetings aid the close monitoring of investments to identify potential risks and allow corrective action where possible.
  • Regular board meetings and dialogue with the directors, along with policies to control conflicts of interests and co-investment with the Marlborough Fund mandates, support strong governance.
  • Quarterly risk reports provide an oversight of potential vulnerabilities such as the concentration of balance sheet risk, earnings risk, valuation risk and liquidity.

Shares Buy-Back and Management of Shares' Liquidity

In order to improve the liquidity in the ordinary shares of the company, the board has established share buy-back policies whereby the company will purchase ordinary shares for cancellation.

  • Targets a 5% discount to the net asset value per share to improve shareholder returns
  • Established track record with more than 14.6 million shares acquired through share buybacks and a further 5 million shares acquired through a tender offer
  • 3-year average share price discount of 5.0% to the net asset value per share of Hargreave Hale AIM VCT.

Share buy-backs are subject to the Companies Act 2006 (as amended), the listing rules and tax legislation, which may restrict the company's ability to buy shares back. The policy is non-binding and at the discretion of the VCT board.

Divided Policy

The company has established dividend policies that target tax-free dividend yields equivalent to 5% of the year end net asset value.

  • Established track record
  • Semi-annual distributions
  • Distributions will vary with investment performance.

The ability to pay dividends is also dependent on the VCT's available reserves and cash resources, the Companies Act 2006 (as amended) and the listing rules. The policy is non-binding and at the discretion of the VCT board. Dividend payments may vary from year to year in both quantum and timing. In good years, the directors may consider a higher dividend payment; in poor years, the directors may reduce or even pay no dividend.

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