The European Investment Bank (EIB) has granted a EUR 250 million loan to ICO for its “FOND-ICO Global” fund-of-funds to improve the capitalisation of Spanish companies. This is the second operation mounted by the EIB and ICO under the Investment Plan for Europe. Half of the EUR 250 million loan is covered by the Investment Plan guarantee. The agreement was signed today in Madrid by EIB Vice-President Román Escolano and ICO’s CEO, Emma Navarro.
The operation is designed to give a boost to private investment in Spain. FOND-ICO Global was set up in 2013 to catalyse the creation of private funds and strengthen alternative sources of finance to bank loans. Since its launch, FOND-ICO Global has approved investments in 39 funds in the amount of EUR 947 million, accounting for 63% of the EUR 1.5 billion dedicated to this initiative. This new impetus provided by the Investment Plan for Europe and the EIB will enable FOND-ICO Global to continue taking stakes in funds fostering the long-term growth and expansion of the beneficiary firms. At the same time, today’s loan will serve as an encouragement for other countries to put in place similar platforms in support of private venture capital.
Under this operation, the EIB will share with ICO the risk on the investments made by FOND-ICO Global up to the amount of EUR 125 million. The loan is designed to mobilise total investment of EUR 4.6 billion to finance midcap companies in Spain and offer them an alternative source of funding to traditional loans. This initiative will also have a positive job creation impact by benefiting firms with high growth potential. The funds in which FOND-ICO Global has stakes have to date invested EUR 683 million in over 150 Spanish businesses employing more than 50 000 people.
When signing the agreement Román Escolano said that “this loan will help to promote privately managed venture capital funds investing in small and medium-sized Spanish companies. Through this operation we will attract other private investors to Spanish venture capital funds and foster the growth and expansion of Spanish firms”.
Emma Navarro added that “this operation is a further indication of ICO’s involvement in the Investment Plan for Europe. Thanks to this instrument for cofinancing with the EIB, ICO is taking another step forward in its support for business funding through FOND-ICO Global, which will continue injecting capital into Spanish companies, helping them to deleverage and improving their competitiveness”.
Photographer: EIB ©To be defined
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