Limited Liquidity

Share Exchange

If an offer is available, the Share Exchange can allow an EIS investor to sell their shares in a company within their portfolio.  

This unique service is delivered through an easy to navigate platform, allowing Mercia’s investors to  review all of the offers available on the portfolio companies they hold.  Should they choose to, they can then opt for how many of their shares they would like to sell against the offer. The platform is supported by a messaging system which keeps the investor updated on the progress of the offer.

On the other side of the trade is Mercia Technologies PLC, which supports the emerging stars from Mercia’s EIS & SEIS funds by providing later stage expansion capital. Through the Share Exchange, Mercia Technologies may seek to increase portfolio holdings beyond new funding rounds by making offers available to investors. 

Illustrative example:

Mercia Growth Fund invests in a company at a £1.0million valuation.  The company performs well and Mercia Technologies decides to invest at a valuation of £4.0million.  Subsequently, if some of the original Mercia Growth Fund investors wish to sell, Mercia Technologies may offer to buy shares in this company at a valuation of £3.0million.

Please note: there is no guarantee that Mercia Technologies PLC will invest in any companies in your portfolio, and there is no guarantee of any offers to purchase shares.

These offers are made at a discount to the current valuation (normally a 25% discount) as calculated by Mercia Technologies PLC which is made available to all Mercia investors for complete transparency.

The platform does not provide the ability for a private investor to buy shares. Mercia is not authorised to provide advice and recommendations are not given by Mercia. Private investors, and/or their advisers, must choose at their discretion, after reviewing the full terms and conditions available on the platform, to accept any such offer available. If shares are disposed within the three year holding period under EIS rules then qualifying status of those shares would be lost and any tax reliefs received would have to be repaid (this is highlighted through the exchange should investors be unsure of the status). There is no guarantee that an offer will be made to an investor’s holdings within the fund, past performance should not be seen as an indicator for future fund performance.

 

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