Merian Chrysalis has said it aims to soon become self-funding as it reveals it has raised £95m from its latest placing, nearly doubling the amount it had initially targeted.
The £498.4m investment trust, managed by Richard Watts (pictured) and Nick Williamson, announced last Monday it was seeking £50m to be used for a mystery target investment, which it later revealed was branding business You & Mr Jones. It will become the investment trust’s first holding outside the UK and Europe.
Yesterday, the investment trust announced in a regulatory filing that the target raise had been increased to £75m on “significant demand”. But another filing this morning revealed the fundraising had surpassed that target too bringing in £95m.
In a statement, Williamson said: “Our medium-term ambition for Merian Chrysalis is to build a company of substantial scale that will use realisations to become self-funding. While we expect NAV growth to be a significant contributor to this scaling process, this raise marks another step in this direction.”
Funds in excess of the $60m required for the You & Mr Jones investment will be used for follow-on funding for existing holdings and a pipeline of opportunities. Merian Chrysalis had said the majority of these extra funds would be deployed before the end of the year.
Merian Chrysalis fundraising has been stronger post IPO
When Merian Chrysalis IPO’d in November 2018, it raised only half the £200m it was targeting. But the investment trust has had several oversubscribed placings since and raised £175m in November 2019, eclipsing the amount it had raised at launch.
While Covid-19 has put a dampener on IPO activity, secondary fundraising has remained comparatively buoyant with £4bn raised in the year to date, according to AIC data.
In contrast, Nippon Active Value is the only IPO in the year to date raising £103m in February mere days before the market sell-off.
Nevertheless, IPO activity is starting to pick up with the Triple Point Energy Efficiency Infrastructure investment trust and Home Reit both listing this month, while a trio of UK equity investment trusts are also launching: Tellworth British Recovery & Growth, Buffettology Smaller Companies and Schroder British Recovery.
Collectively the five investment trusts are targeting £900m.
See also: Spate of contrarian investment trust IPOs after coronavirus drought stuns investors
