BGF declares maiden dividend to shareholders
AS part of BGF’s ongoing organisational evolution and executive structure as it prepares for the next chapter of growth, BGF today announces that Andy Gregory, current Chief Investment Officer, is to be appointed by the Board as Chief Executive Officer, effective on 1 September 2022. Stephen Welton, Executive Chair, will step up to Non-Executive Chair effective 1 January 2023, following a decade of successful executive leadership.
This is the culmination of a process designed and delivered by an independent leadership advisory panel working with the Board of BGF and its shareholders over the last three years. Andy has held the role of Chief Investment Officer since May 2021 and before that was Head of Investments, UK & Ireland since January 2020.
During this time, BGF has experienced a record period of investment and exit activity. Andy has been with BGF since 2011, joining as regional director for the North of England. Before that, he held senior roles in the private equity industry including at LivingBridge and Bridgepoint.
Stephen was appointed founding CEO of BGF in 2011 and under his leadership, BGF has grown from a start up to become the most active growth capital investor in the UK & Ireland, with more than £3bn invested across over 400 companies by a regional network of 16 offices. In this period, Stephen has also served as a member of HM Treasury’s Patient Capital Review, the Council of Innovate UK, and the PM’s business advisory council. Prior to BGF, Stephen was one of the founding partners of the global private equity firm CCMP Capital (formerly JP Morgan Partners) and Managing Director of Barclays Private Equity and Henderson Ventures, which he also co-founded.
BGF has also just declared its maiden dividend of £30m to its shareholders: HSBC, Barclays, Lloyds Banking Group, NatWest and Standard Chartered. In line with original objectives to create a self-sustaining investment platform over the long term, BGF has not drawn on committed shareholder capital since June 2021, with cash realisations now funding investment activity which will allow excess returns to be returned to shareholders going forward.
Last year, BGF delivered a total cash return of £571m from exits (up from £233m in 2020), equivalent to an average 2x money multiple and a 23.4% gross internal rate of return. Returns from 22 exits in the first half of 2022 continued this strong trend with £391m realised and a gross IRR of 23%. Pre-tax profit in 2021 was £404m.
Stephen Welton said: “From a standing start in 2011 and spurred on by the global financial crisis, BGF’s leadership, shareholders, regulators and other stakeholders envisaged a new equity investment platform that would deliver long-term value creation and patient capital, supporting entrepreneurs on a local basis right across the country. I could not be prouder of what has been achieved and would like to thank our portfolio companies, our team and our shareholders for their enduring support in delivering what is a core mission for BGF and a crucial part of the growth economy.
“After more than a decade of executive leadership, I am delighted to take on the role of Non-Executive Chair and welcome Andy Gregory as incoming CEO. Andy has delivered strong investment performance as CIO, knows the market incredibly well, and will continue to drive forward the BGF model and mission. The additional appointments to the leadership team demonstrate the breadth of talent we have at BGF and the exciting future ahead.
“As Non-Executive Chair, I will remain a champion of fostering the BGF culture and efforts to support a more diverse and inclusive investment environment, with a strong focus on ESG and the scaling of BGF’s charitable foundation. More generally, I look forward to building on the work we have done as a catalyst of the growth capital industry, both in the UK and internationally, at what is a critical time for investment into the key sectors of the future.”
Andy Gregory, incoming CEO at BGF, said: “BGF holds a unique position in the investment industry, which it has established thanks to the hard work of a highly skilled team, Stephen’s unwavering leadership and the support of our shareholders.
“I am delighted to be taking on the role of CEO, with Stephen’s support as Non-Executive Chair. We will continue to drive forward our investment activity and deliver exits that create long-term value for the entrepreneurs we back, as well as for our shareholders. Against the backdrop of several major macro events impacting the UK & Irish economies, there has never been a more important time to back our entrepreneurial wealth creators. This is something BGF will continue to do over the next decade and beyond.”
Neil Johnson, Deputy Chairman at BGF, said: “The Board and shareholders of BGF welcome Andy’s appointment as CEO, recognising his fundamental successes in the various roles held since joining BGF. Stephen has played a huge role in developing BGF in the last decade, and the Board is delighted that he will be continuing to support the firm’s future growth in his new role as Non-Executive Chair.”
To support the new leadership structure, new appointments have been made to BGF’s Executive Committee, effective 1 January 2023. These include Richard Taylor, Head of Growth, Ben Barker, Head of Portfolio, and Cate Poulson, Head of Talent Network, who will all join Andy Gregory, Claire Lamb and Matt Reed on BGF’s Executive Committee.
Patrick Graham, Head of Scotland and Northern Ireland, Neil Inskip, Head of North West and Midlands, and Ned Dorbin, Head of South West and Wales, will join the current members of BGF’s Investment Committee, the firm’s central engine for investment decision making.