Industry Investment accelerates growth

Industry Investment
accelerates growth

For Finnish Industry Investment, 2014 was an active year in terms of volume. The company made direct investments totalling about EUR 40 million in more than 20 companies and investment commitments worth EUR 40 million in six funds.

According to Industry Investment’s President and CEO Martin Backman, the economic results last year were unsatisfactory. The majority of the companies in the portfolio have a Finnish emphasis, and thus the challenging economic situation in Finland and the heightened Russian crisis late last year weakened the development of the companies.

In 2015, Industry Investment will continue focusing on its investment strategy. Industry Investment emphasises international growth in the SME sector and invests in companies that are growing internationally. The company also focuses on later stage venture capital investments together with foreign venture capitalists, and will selectively invest in the best venture capital funds in Finland.

“It is my view that Industry Investment has a central role in promoting the internationalisation of Finland’s SMEs and an important role in developing Finland’s venture capital market.”

Industrial Renewal investment programme was launched

Among the most significant events last year was the launch of the EUR 100 million Industry Renewal investment programme and the establishment of the Industry Investment-managed fund-of-funds FoF Growth II. FoF Growth II channels Finnish institutional capital to venture capital funds operating in Finland, which in turn invest in companies needing venture capital or growth financing.

The Industry Renewal investment programme is a EUR 100 million programme focusing on industrial digitalisation, health technology, bio-based economy and cleantech.  Industry Investment invests in general EUR 2−5 million in innovative technology companies.

“Through the programme, we channel capital to the portfolio companies to fund and accelerate growth; additionally, we bring business expertise to these companies through our network,” Backman notes.  

Last autumn Industry Investment participated in NewIcon Oy’s financing round. NewIcon develops and manufactures automation and robotics solutions for pharmacies, hospitals and laboratories.

“With this investment, we want to expedite the international growth of the interesting health technology company,” Backman says.

Good outlook for Meyer Turku

In early autumn 2014, the Finnish State (through Industry Investment) became a minority owner in Meyer Turku Oy, which continues the Turku shipyard’s operations.

According to Backman, the outlook for Meyer Turku seems favourable and new orders are on the horizon. In conjunction with the transaction, the company signed two new ship order agreements worth a billion euros with Royal Caribbean. This means about 10,000 man-years for the Turku marine cluster. Additionally, the company recently received an order worth EUR 230 million from Tallink.

Finnish Industry Investment Ltd's investment activities

Fund investments
  • Domestic and international venture capital and growth funds.
  • Development of venture capital market and promotion of its internationalisation.
M&A and buyouts
  • Company growth and renewal through mergers and acquisitions, either in Finland or abroad.
  • Financial instruments: equity, subordinated loan, convertible bonds or mezzanine financing.
Direct investments in growth companies
  • Capital, expertise and networks to promote companies’ growth in international markets.
Industrial policy investments
  • Direct investments in companies that are important for Finland’s national economy in terms of developing or retaining a certain industry segment, know-how or technology.