London Merchant Securities is expecting gains from its venture capital arm to slow, but still expects its e-business stakes to boost its property arm.
LMS posted a 128% increase in full-year profits to £122.4m, with the lion’s share coming from its venture capital stakes.
Profits were boosted by the seven flotations of firms in which LMS has invested. But joint managing director Robert Rayne said: ” I think the rate of IPOs will slow from now on.”
The company recently struck an innovative deal at its 5,620m2 (60,500 sq ft) office development in San Francisco, with a prelet to Twelve Entrepreneuring, an e-business venture capital outfit.
LMS has the right to acquire a stake in Twelve and also to invest in any companies it may create and to have first refusal to house them.
Rayne said: “We will look at doing similar deals in the UK. This is one of the ways in which the two strands to our business are complementary.”
The company has had a venture capital arm for 25 years and has investments as diverse as sports club operator Esporta, internet job site Stepstone and radio station Jazz FM.
The company is also looking at redeveloping and refurbishing parts of its Fitzrovia office portfolio as well as developing out its retail and leisure schemes.
Executive chairman Lord Rayne will step down at the next AGM after 40 years at the helm. Graham Greene will become non-executive chairman.
