Maven VCTs

[james188]

I see that the Maven VCTs have joined the queue today. What I consider unusual is that they have conditioned their offers on the outcome of general meetings in early November which will facilitate the size of the offers now being made. No doubt the resolutions will be passed and that this will be a formality, but this is extra execution risk for investors. It suggests that Maven have accelerated offers in advance of what was planned. Other leading VCTs managed to get all their ducks in a row much earlier so that investors did not have to worry about this.

[Karellan]

Many thanks for noticing this James , I took it up with them. I got a fairly quick response overnight saying that it was fairly standard practice not unusual and their lawyers advised that this was the right approach.... I was re-assured. I used the opportunity to say something about the increasing difficulty of buying VCTs nowadays.

[sinterklaas]

the increasing difficulty of buying VCTs nowadays

What did you mean? Theirs or generally? Which aspects are getting more difficult?

[Karellan]

the increasing difficulty of buying VCTs nowadays

What did you mean? Theirs or generally? Which aspects are getting more difficult?

I mean generally. Demand is high and some of the issues have been close to the end of the tax year. I could go on if you like ?

[sinterklaas]

I mean generally. Demand is high and some of the issues have been close to the end of the tax year. I could go on if you like ?

I see your point - although this year you have more choice than ever, early in the year, and enough capacity I would think.

[scotia]

In an email from Maven, received today:-

Maven has made a profitable exit from SPS, the UK’s largest provider of promotional merchandise, delivering a 3x return on funds invested in 2014. SPS has been acquired by Polyconcept Group, which is the largest promotional products supplier globally, selling into over 100 countries.The transaction is the 2nd profitable exit for Maven investors in recent months, following the sale of Crawford Scientific in October for 4.7x the initial investment.
Maven led the management buy-out of SPS from 4imprint Group plc in February 2014 to support its strategy of growing the business organically and by acquisition.

Nice to see a profitable exit - but I suspect such management buy-outs are no longer allowable. There was a belief that the government was proposing to soften this decree by permitting some form of replacement capital - does anyone know what progress, if any, has taken place on this front?

[Kidman]

Maven 3 and 4 have issued a supplementary prospectus to bring potential risks stemming from the last budget to prospective investors' attention. It makes for a good summary of the main changes.

https://www.mavencp.com/assets/000/001/475/Maven_VCT_3___4_Supplementary_Prospectus_original.PDF?1516813455

[Kidman]

Maven VCTs 1, 3, 4 and 5 have announced dividends today "following a number of recent profitable realisations and to ensure that the Company will continue to comply with the VCT regulations at all times".

[scotia]

Maven VCTs 1, 3, 4 and 5 have announced dividends today

And they are generous:-
Maven 1 Div = 7.45p
Maven 3 Div = 5.7p
Maven 4 Div = 8.9p
Maven 5 Div = 3.7p
All to be paid on 13/4/18. So the DRIS with 3,4 will fall into the next financial year.

[sinterklaas]

". . . and to ensure that the Company will continue to comply with the VCT regulations at all times"

What's this aspect of it all about then. It's the same reason MIG3 / MAV4 gave for paying interims early last autumn. Is it just returning cash from years ago that they never got around to investing?

[Kidman]

... Is it just returning cash from years ago that they never got around to investing?

I don't know the answer but suspect you are correct that it is all about cash holdings.
For example, a VCT must not retain an amount greater than 15% of the income it derived in any accounting period, which is similar to an investment trust rule. It suits me because it ensures dividends being paid rather than earning nothing but fee liabilities while kept as cash. That money can then be spent on new shares (most easily via a dividend reinvestment plan) and the VCT then has money which has to be invested within a certain time to keep to the rules.

[shawsdale]

More Maven VCT dividends announced today:

MIG1: 5.1p
MIG2: 5.2p
MIG3: 5.25p
MAV4: 4.8p

According to the RNS announcements, "following a number of profitable realisations and to ensure that the Company continues to comply with the VCT regulations at all times" (payment) "will be made on 22 June 2018 to Shareholders on the register at close of business on 25 May 2018."

[Shavtedagin]

Thanks for that update.

Some nice dividends, but if I'm not mistaken, a continued return of our capital rather than dividends being funded by an increase in total return. Becoming more and more common now. It suits me as a gradual wind down of VCT investments, but not so good for longer term holders. I wonder if Maven are considering a wind up of some funds, finally a merger of sorts or are preparing for a large fundraise? MAV 2 NAV now a lowly £14m fund.

[Karellan]

Some nice dividends, but if I'm not mistaken, a continued return of our capital rather than dividends being funded by an increase in total return. Becoming more and more common now. It suits me as a gradual wind down of VCT investments, but not so good for longer term holders. I wonder if Maven are considering a wind up of some funds, finally a merger of sorts or are preparing for a large fundraise? MAV 2 NAV now a lowly £14m fund.

I have been not unhappy with the gradual return of capital from these extra fat dividends too as it will save me selling off some in a few years but as you say the longer term return must suffer. These Mavens are indeed quite small and it does make you wonder when they will follow the trend of merging for size.

When I bought my Mavens in 2008/9 they had a policy of dividend growth - how things change.