About Hargreave Hale AIM VCT
We are an established venture capital trust listed on the London Stock Exchange. Launched in 2004, we have been investing in both public and private companies for almost 20 years. The VCT has a diversified portfolio of small high growth UK companies, mostly companies listed on AIM, with a track record of providing long-term investment opportunities across a wide variety of sectors. Many of our most successful investments have been held for over 10 years.
- To generate capital gains and income from the portfolio
- To make distributions from capital or income to shareholders whilst maintaining status as a venture capital trust.
The VCT achieves its investment objectives by making qualifying investments in companies listed on AIM, private companies and companies listed on the AQSE Growth Market, as well as non-qualifying investments as allowed by the VCT rules.
A complete copy of the investment policy can be found here.
The Hargreave Hale AIM VCT will not invest in any proposed investee company that fulfils any one of the following criteria:
- Companies that manufacture or distribute munitions banned under the Geneva Convention
- Companies which derive their revenues from pornography or other sexually exploitative material
- Companies that manufacture or distribute marijuana-based products
- Companies which derive their revenues from cryptocurrencies or other non-regulated digital currencies
- Companies in which a director has previously been sanctioned or disqualified by a professional body
- Companies that have breached the Modern Slavery Act or found, through due diligence, to have exploitative employment/working practices
- Companies which derive their revenues from predatory lending.
The Hargreave Hale AIM VCT will divest of its holding in any investee company that fulfils any one of the following criteria:
- Any company that, following an investment by the VCT, subsequently falls into one of the categories in the Exclusions policy
- Any company that continually allows material breaches of legislation applicable to it
- Any company whose senior managers and/or directors have been reckless as to the consequences of not adhering to applicable legislation or expected codes of governance, resulting in material harm (unless the relevant senior managers/directors are removed)
- Any company that continually and materially disregards shareholder rights.
Qualifying investments are typically small companies which are either UK based or have a UK presence. These companies often carry high levels of investment risk but offer the potential for significant capital appreciation.
The investment manager (Canaccord Genuity Asset Management - CGAM) will maintain a diversified portfolio of qualifying investments which may include equities and fixed interest securities as permitted by the VCT rules. Further information on qualifying investments can be found here.
To maintain its status as a VCT, the VCT must have 80% 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. To provide some protection against an inadvertent breach of this rule, the investment manager targets a threshold of approximately 85%.
Any non-qualifying investments must be permitted by the VCT rules and may include equities and exchange traded funds listed on the main market of the London Stock Exchange, fixed income securities, bank deposits that are readily realisable, the Marlborough Special Situations Fund and the Marlborough Micro-Cap Growth Fund.
Subject to the VCT’s investment policy, the allocation to each of these investment classes will vary to reflect the investment manager's view of the market environment and the deployment of funds into qualifying companies. The market value of the non-qualifying investments (excluding bank deposits) will vary between nil and 50% of the net assets of the Hargreave Hale AIM VCT. The value of funds held in bank deposits will vary between nil and 30% of the net assets of the VCT.
The dividend policy targets a tax free dividend yield equivalent to 5% of the year end net asset value.
The VCT has a well-established track record of paying out tax free dividends to shareholders. The VCT aims to pay an interim dividend in July each year and a final dividend in February. Special dividends may also be paid by the VCT following significant realisations of investments.
The ability to pay dividends is also dependent on the VCT’s available reserves and cash resources, the Companies Act 2006 (as amended), the Listing Rules and the VCT rules. The policy is non-binding and at the discretion of the Board. Dividend payments may vary from year to year in both quantum and timing. The level of dividend paid each year will depend on the performance of the VCT’s portfolio. In years where there is strong investment performance, the directors may consider a higher dividend payment, including the payment of special dividends. In years where investment performance is not as strong, the directors may reduce or even pay no dividend.
Further information on dividend payments over the last five years can be found here. Please contact us if you require information on dividend payments in earlier periods.
As part of the VCT’s dividend policy, the VCT calculates its NAV yield on an ongoing basis. The NAV yield is calculated by dividing the dividends payable in relation to a financial year expressed as a percentage of the relevant closing NAV per share. Whilst a helpful metric, it is a statement of historical fact and is not therefore a forward-looking statement or a guide to future performance.
Please refer below for VCT NAV yields over the previous five years. Please also refer to the 'Dividend policy' for more information on how the NAV yield is calculated. Please note that the NAV yield is not a forward-looking statement, refers to the past and is not a reliable indicator of future results. The NAV yield is not therefore a guide to the future performance of the VCT.
Subject to the control framework described in the Hargreave Hale AIM VCT’s co-investment policy, the investment manager may make co-investments in investee companies alongside other funds, including other funds managed by CGAM.
Other than bank deposits, no individual investment shall exceed 10% of the Hargreave Hale AIM VCT’s net assets at the time of investment.
How does the management team find investment opportunities?
The CGAM team has significant reach into the market and meets with large numbers of companies each week. These meetings provide insight into investee companies, their end markets, products and services, or the competition. The CGAM VCT management team follows a stock specific investment approach based on fundamental analysis of the investee company.
Investments are made to support the growth and development of a company. The key selection criteria used in deciding which investments to make include, inter alia:
- The strength and depth of the management team
- The business strategy
- A prudent approach to financial management and forecasting
- A strong balance sheet
- Profit margins, cash flows and the working capital cycle
- Barriers to entry and the competitive landscape
- The balance of risk and reward over the medium and long term.
Investments are monitored closely and CGAM usually meets or engages with their senior leadership team at least twice each year. Where appropriate, the Hargreave Hale AIM VCT may co-invest alongside the other funds managed by CGAM, as noted above.
Investment approach for qualifying investments
Working with advisers, the investment manager will screen opportunities, often meeting management teams several times prior to investment to gain a detailed understanding of the relevant company. Investments will be sized to reflect the risk and opportunity over the medium and long term. In many cases, the investment manager will provide further funding as the need arises and the investment matures. When investing in private companies, the investment manager will shape the investment to meet the investee company's needs whilst balancing the potential for capital appreciation with risk management. Seed funding is rarely provided and only when the senior leadership team includes proven business leaders known to CGAM.
Investments will be held for the long term unless there is a material adverse change, evidence of structural weakness, or poor governance and leadership. Partial realisations will be made where necessary to balance the portfolio or, on occasion, to capitalise on significant mispricing within the stock market.
Investment approach for non-qualifying investments
The VCT team works closely with the wider CGAM team to deliver the investment strategy when making non-qualifying investments, as permitted by the VCT rules. The investment manager will vary the exposure to the available asset classes to reflect its view of the equity markets, balancing the potential for capital appreciation with risk management, liquidity and income.
The non-qualifying investments will typically include a focused portfolio of direct investments in companies listed on the main market of the London Stock Exchange. The portfolio will mix long-term structural growth with more tactical investment to exploit short-term mispricing within the market.
The use of the Marlborough Special Situations Fund enables the Hargreave Hale AIM VCT to maintain its exposure to small UK companies whilst the investment manager identifies opportunities to invest the proceeds of fundraisings into qualifying companies.
The investment manager may use certain exchange traded funds listed on the main market of the London Stock Exchange to gain exposure to asset classes not otherwise accessible to the VCT.
How does the Hargreave Hale AIM VCT manage risk?
The structure of the Hargreave Hale AIM VCT investment portfolio and its investment strategy has been developed to mitigate risk where possible.
- The VCT has a broad portfolio of investments to reduce stock specific risk.
- Flexible allocations to non-qualifying equities, exchange traded funds listed on the main market of the London Stock Exchange, fixed income securities, bank deposits that are readily realisable and the Marlborough Special Situations Fund, allow the investment manager to adjust portfolio risk without compromising liquidity.
- Regular meetings with investee companies aid the close monitoring of investments to identify potential risks and allow corrective action where possible. In order to address the additional risks posed by the COVID-19 pandemic on smaller businesses, the investment manager has increased the number and frequency of meetings that it's holding with investee companies.
- Regular board meetings and dialogue with the VCT’s directors, along with policies to control conflicts of interests and co-investment with the Marlborough fund mandates, support strong governance.
Discount control policy and management of share liquidity
The Hargreave Hale AIM VCT aims to improve liquidity and to maintain a discount of approximately 5% to the last published NAV per share (as measured against the mid-price) by making secondary market purchases of its shares in accordance with parameters set by the board of directors of the VCT (the Board).
This policy is non-binding and at the discretion of the Board. Its operation depends on a range of factors including the Hargreave Hale AIM VCT’s liquidity, shareholder permissions, market conditions and compliance with all laws and regulations. These factors may restrict the effective operation of the policy and prevent the VCT from achieving its investment objectives.
The materials contained herein have been prepared for use solely by individuals who are resident in the United Kingdom for tax and investment purposes. The materials contained herein are not for release, publication, or distribution, directly or indirectly, in whole or in part, to US persons or into or within the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, Japan, the Republic of South Africa or any other jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.
There will be no public offering of the securities referred to herein and on the pages that follow in the United States, Australia, Canada, Japan, the Republic of South Africa or any other restricted jurisdiction. The securities referred to herein and on the pages that follow may not be offered, sold, resold, pledged, delivered, distributed or otherwise transferred, directly or indirectly, into or within the United States, Australia, Canada, Japan or the Republic of South Africa or to any national, resident or citizen of the United States, Australia, Canada, Japan or the Republic of South Africa. Potential users of this information are requested to inform themselves about and to observe any such restrictions.
The information on the pages that follow may contain forward‑looking statements. Any statement other than a statement of historical fact is a forward‑looking statement. Actual results may differ materially from those expressed or implied by any forward‑looking statement. The Company does not undertake any obligation to update or revise any forward‑looking statements, whether as a result of new information, future events, or otherwise. You should not place undue reliance on any forward‑looking statement, which speaks only as of the date of its issuance.
By using this website you confirm that you have read, understood, and accepted these conditions, including (without limitation) the risks noted below which may be involved in investing in the shares of the Company. The Company may change these conditions. The changes will be posted on the website and you should check regularly to see any changes or updates to these conditions. Your access to this website is governed by the version of these conditions then in force.
1. Terms and conditions
The terms and conditions set out below apply to your use of the Company’s website. Please read them.
The "Company" or the "VCT" means Hargreave Hale AIM VCT plc and references to "the Company’s website" are to the website available at www.hargreaveaimvcts.co.uk and also include, but are not limited to, the text, documents, images, links, sounds, graphics, and video sequences displayed on the website (the "Materials").
The Company’s website is operated by Canaccord Genuity Wealth Limited (“CGWL”). CGWL is a private limited company incorporated in England and Wales with company number 03739694 and has its registered office at 88 Wood Street, London, England EC2V 7QR. CGWL is authorised and regulated by the Financial Conduct Authority with firm reference number 194927. Details of CGWL’s registration can be found on the FCA’s website at https://register.fca.org.uk/s/.
By clicking and entering www.hargreaveaimvcts.co.uk you agree that you have read and accept these terms and conditions. If you do not agree, do not use www.hargreaveaimvcts.co.uk.
2. Intended audience and access to the Company's website
No information contained on the Company's website or in the Materials should be taken as a recommendation, offer or invitation to buy, sell, hold or otherwise deal with the shares or other financial instruments of any entity nor is it intended to solicit any such offer or invitation. Nothing on the Company’s website or in the Materials constitutes or is intended to constitute investment or other advice (including, without limitation, legal or tax advice) or investment research and you should not act upon any information contained on the Company’s website or in the Materials without first consulting a financial or other professional adviser.
The information in the Company’s website is only for the attention of individuals who are resident in the United Kingdom for tax and investment purposes. It is your responsibility to be aware of and to observe all applicable law and regulation in the United Kingdom. To the extent that you are not resident in the United Kingdom for tax and investment purposes, do not use this website.
The Company’s website is not intended to offer or to promote the offer or sale of the shares in the Company (the "Shares") in the United States or to US Persons. Each acquirer of the Shares will be deemed to represent, amongst other things, that (i) it is not in the United States, (ii) it is not a US Person or acquiring the Shares for the account or benefit of a US Person, and (iii) it is acquiring the Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act.
The content of the Company’s website constitutes a ‘financial promotion’ for the purposes of the UK regulatory regime. The content of the Company’s website has therefore been issued and approved for the purposes of section 21 of the Financial Services and Markets Act 2000 by CGWL which is authorised and regulated by the Financial Conduct Authority (with firm reference number 194927). Nonetheless, the content of this website does not constitute investment or other advice given by CGWL and you should not act upon any such content or the Materials without first consulting a financial or other professional adviser.
3. Risks of investing in VCTs
Investing in a VCT (including the Company) carries a high level of risk and it should be remembered that the price of shares in a VCT, and the income from such shares (if any), may go down as well as up. An investment in the VCT is only suitable for investors who are capable of evaluating the risks and merits of such investment and who understand the potential risk of capital loss (which may be equal to the whole amount invested). Further detail on the risks involved in investing in VCTs is set out in the “Risks of investing in VCTs” section on the front page of this website.
The latest annual report, factsheet and prospectus can be found in the document library. These documents include a more comprehensive list of the risks associated with this product. Please ensure that you have read and considered carefully each of the risks identified in these documents before investing in the VCT.
5. Limitation of liability
Use of the Company’s website and the Materials are at your sole risk. The Company and CGWL will not be liable to any person for any direct, indirect, special or consequential, losses, damages, or awards of any kind, howsoever caused, as a result of the use of or inability to use, or reliance on, the Company’s website or any of the Materials. To the maximum extent permitted by applicable law and regulation, the Company and CGWL exclude all warranties, conditions, terms, undertakings, and representations (excepting fraudulent misrepresentation) of any kind, express or implied, statutory or otherwise in connection with the Company’s website and the Materials. Nothing in these terms and conditions shall be taken to limit or exclude any liability which may not otherwise be limited or excluded under applicable law or regulation.
Nothing in this website should be construed as investment, tax, legal, or other advice, nor is it to be relied upon in making an investment decision. Those accessing the website should consult their financial advisers regarding the suitability of any of the products referred to on this website. The value of investments and the income from them may go down as well as up and an investor may receive back less than the original investment. Past performance is not necessarily a guide to future performance.
Trading in securities in smaller companies or a VCT (such as the Company) which invest in emerging markets may involve greater risks and be subject to more abrupt price movements than trading in securities of larger companies.
The Materials and the Company’s website are provided on an "as is" and "as available" basis and do not purport to be full or complete. The Company and CGWL give no warranties (express, implied, or statutory) as to satisfactory quality or fitness for purpose of the Materials, including, without limitation, as to the accuracy, validity, timeliness, merchantability, or completeness of any information or data contained therein (whether prepared by the Company or by any third party), or that any of the Materials or that the Company’s website will be provided uninterrupted or free from errors or that any identified defect will be corrected. The Company and CGWL have the right to suspend or withdraw the provision of all or any of the Company’s website or the Materials without prior notice at any time. You are entirely responsible for your use of the website and for the consequences of relying on any content. Further, no warranty of any kind is given that the Company’s website and the Materials are free from any virus or other malicious, destructive, or corrupting code, program, or macro. The Company and CGWL do not warrant that the Company’s website or the server(s) that make(s) them available are free of any virus or other harmful elements.
To the maximum extent permitted by applicable law and regulation, the Company and CGWL disclaim all liability to you arising out of your use of the website. In particular, the Company and CGWL shall not be liable for any direct or indirect loss or damage to you, any loss of profits, loss of business, revenue, data, goodwill, or anticipated or consequential loss or damage.
Reference in the Company’s website and/or the Materials to any hypertext link, product, process, or service does not imply the Company’s and/or CGWL’s support for, or endorsement or recommendation of the provider thereof or the product, process, or service to which reference is made. The Company’s website may contain hypertext links to other websites, resources, or other third parties. The Company and CGWL are not responsible for the availability of, and accepts no liability in relation to, these external websites or their contents. Each of the Company and CGWL is not a sponsor, partner, promoter, or publisher of any such website.
If any provision of these terms and conditions is found to be illegal, invalid or unenforceable, the invalidity of that provision shall not affect the validity of the remaining provisions of these terms and conditions which shall remain in full force and effect.
8. Governing law
The agreement between you and the Company relating to your use and browsing of the Company’s website is governed by and shall be construed in accordance with the laws of England and Wales and you agree that the Courts of England shall have exclusive jurisdiction over any disputes arising in relation to such use and browsing. These terms and conditions may not be modified unless the Company agrees in writing.
10. The Materials that you are seeking to access are not directed at and may not be viewed by or distributed to persons who are resident outside the United Kingdom, including but not limited to:
- who are in the United States or who are, or are acting for the account or benefit of, US Persons; or
- who are in a jurisdiction where it is not lawful to access the Materials.
By clicking "I accept" below, you represent, warrant and agree that you (1) have read and understood the terms and conditions and other information set out above, (2) agree to be bound by its terms and acknowledge that the Company and its affiliates, subsidiaries, directors and advisers may rely on your agreement, (3) are permitted under applicable laws and regulations to receive the information contained in the pages that follow and, (4) agree that you will not transmit or otherwise send any information contained in this website to any person in the United States, to any US Person, or to publications with a general circulation in the United States. If you cannot so certify and agree, you must click the button labelled "I decline" or otherwise exit this website.
Investment involves risk and you may not get back what you invest. It’s not suitable for everyone.
Investment involves risk and you may not get back what you invest. It’s not suitable for everyone.