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West Midlands SMEs bank on new £56million growth fund

Wednesday 4th June 2014

Businesses across Greater Birmingham, Solihull and the Black Country have been given the opportunity to access finance for growth and job creation as part of a £56million Mezzanine Fund launched last week. 
Managed by Finance Birmingham, the fund will be the largest individual growth capital fund for small to medium sized businesses (SMEs) in the West Midlands.
The fund is expected to help more than 40 businesses and create or safeguard 5,000 jobs across the region over the next five years.
Businesses will be able to apply for loans of between £250,000 and £2million to fund development and growth plans. Typical investments are expected to be around £1million. 
The funds will be given as mezzanine loans – an innovative finance, which sits between traditional debt and equity and avoids part ownership by investors. 
Finance Birmingham’s Mezzanine Fund will run from May 2014 to March 2019.  
Sir Albert Bore, Leader of Birmingham City Council, said: “This fund demonstrates how public and private funds can be structured and leveraged to create a dynamic resource for growing businesses across the West Midlands. Our region is home to a growing and diverse range of entrepreneurs who, with the right support and backing, can create jobs and boost the local economy.” 
“The fund also provides a model for those in other parts of the UK, on how public and private partners can work together to address some of the biggest issues facing business growth – in this case, that is much needed funding.”
Pat Hanlon, GBSLEP Board Director, added: “The Mezzanine Fund is an important step forward for businesses across Greater Birmingham, Solihull and the Black Country as it not only fills a gap in the market but also adds to the suite of funds being managed by Finance Birmingham and other providers."
“This shows good collaboration between the two LEPs and the private sector, leveraging in funding way beyond the initial allocation from the Regional Growth Fund."
“It is also an important sign of our collective ability to deliver innovative finance products and recycle the returns we have made from investments via funds like Growing Places, to benefit even more companies.” 

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