Portfolio Update – Merkko Group Limited

Capital for Colleagues plc / EPIC: CFCP / Market: AQSE / Sector: Investment
6 July 2020
CAPITAL FOR COLLEAGUES PLC  (‘Capital for Colleagues’ or the ‘Company’)

Capital for Colleagues, the investment vehicle focused on opportunities in the Employee Owned Business (‘EOB’) sector, is pleased to announce that it has sold its investment in portfolio company Merkko Group Limited (‘Merkko’) for consideration of £400,000, a profit on the original investment of 100%. The investment had been prudently valued at £93,000 in the Company’s last audited accounts, and the uplift in valuation to £400,000 had already been reflected in the investment update for the quarter ended 31 May 2020.

Merkko is a builder’s merchant located in Kingston Bagpuize, Oxfordshire, which supplies a broad range of materials and equipment, primarily to members of the construction industry. In October 2015, Capital for Colleagues subscribed £200,000 for 200,000 redeemable, non-voting ‘A’ Ordinary shares in Merkko. These shares have now been redeemed by Merkko at a valuation of £400,000. Capital for Colleagues has used £150,000 of the proceeds from the sale to subscribe for ordinary shares in Merkko representing approximately 10% of that company’s equity capital. The balance of the proceeds will be applied in the ongoing fulfilment of the Company’s investment strategy and for general working capital purposes.

Alistair Currie, Chief Executive of Capital for Colleagues, said:

‘We are delighted with the profitable realisation of our investment in Merkko. We have supported and guided Merkko since 2014 and are pleased to retain an interest in this successful company as it continues to prosper’.

The Directors of the Company are responsible for the contents of this announcement.

For further information, please contact:

Capital for Colleagues
Capital for Colleagues is an investment company focused on the UK EOB sector. The Company has a proven management team, with a wide network of contacts and affiliates, as well as established access to investment opportunities, enabling the Company to execute its strategy and capitalise on EOB-focused investment opportunities. In addition, the Company educates and assists companies that are looking to launch employee ownership schemes, advising them, amongst other things, on how to secure investment and achieve their objectives.

Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.