The move follows the announcement that Finance Yorkshire, which was set up to support a broad range of small and medium-sized businesses, has fully invested its £90m fund.
According to Finance Yorkshire, the fund has made 694 investments in businesses across Yorkshire and North Lincolnshire, and it has helped to create and safeguard 8,716 jobs. A number of the companies have enjoyed rapid growth following the investment.
Finance Yorkshire invested a total of £1.45m in Xeros, the environmentally friendly washing machine company which floated on AIM, (the Alternative Investment Market) earlier this year. The Rotherham-based spin-out from the University of Leeds has created a reusable and recyclable polymer bead cleaning system.
Finance Yorkshire is believed to be the first European JEREMIE (joint European resources for micro to medium enterprise) initiative to become fully invested in England. The fund is backed by grants from the Government and European Regional Development Fund, and finance from the European Investment Bank.
Alex McWhirter, the chief executive of Finance Yorkshire, said: “Many SMEs (small and medium-sized enterprises) across the region have found it difficult to access finance via the traditional routes over recent years. We have been able to provide investment to fill this finance gap for many businesses, enabling them to expand and create jobs in the region.
“The fund will now be managed through the next five years, during which time it is anticipated that a significant legacy fund can be created for the region, for investment back into more businesses in Yorkshire and the Humber. Finance Yorkshire is working with stakeholders to secure further funding to ensure there is continuity to business investment in the region during 2015.
“We expect to make a further announcement on this very soon.”
James Newman, the chairman of Finance Yorkshire, who is also chairman of the Sheffield City Region Local Enterprise Partnership (LEP), said: “This is a significant milestone for everyone associated with the fund. Finance Yorkshire’s investments have given businesses a timely boost that has led to other private sector direct investment and more employment opportunities being created.
“With growth firmly back on the business agenda, the economic impact of this fund cannot be underestimated. It is vital that a second JEREMIE fund is created in 2015 so that all the good work done by Finance Yorkshire is not lost, and it can continue to support businesses in Yorkshire and Humber. I am hoping that all four of the Yorkshire and Humber LEPs will support this important initiative, so we can all build on the excellent performance so far for the benefit of the region’s economy.”
Finance Yorkshire provides seedcorn, loan and equity linked investments, ranging from £15,000 to £2m to help a range of small and medium sized businesses.
The project is supported financially by the European Union. It has attracted £30m investment from the European Regional Development Fund (ERDF) as part of Europe’s support for the region’s economic development through the Yorkshire and Humber ERDF Programme, £15m from the Government and £45m match funding from the European Investment Bank. Finance Yorkshire invests in businesses based or moving to Yorkshire, North Lincolnshire and North East Lincolnshire.