The reasons for this high demand for equity capital are explained Peter Pauli, Spokesperson for the BayBG Management:
"In the wake of the coronavirus crisis, it will be important for many companies to increase their equity again in order to be able to meet current and future challenges. Equity capital is an important building block for increasing crisis resilience, but also for financing investments in the future and transformation measures."
BayBG's investments in expansion and transformation measures for companies doubled to €30 million. This represents the majority of new business. A further €11 million flowed into technology-oriented startups as venture capital investments last fiscal year. To enable the continued existence of medium-sized companies that have implemented succession outside the family or asset diversification, BayBG also invested €11 million in corporate succession planning. New investments in companies undergoing turnaround and restructuring situations amounted to €3 million.
Exits ensure high annual profit
BayBG's portfolio of investments in medium-sized companies and startups also increased to €318 million (previous year: €300 million). Furthermore, the investment company achieved a significant net profit of €14.2 million (previous year: €2.3 million). This was due to several successful exits (share sales), according to BayBG.
Independently of this, BayBG has been implementing the so-called Pillar 2 of the Corona equity aid from the federal and state governments for the Free State as an intermediary. To date, around 100 million euros have been invested in startups and medium-sized companies from this program.
"Overall, we are very satisfied with the annual results. With record investments, we have once again proven ourselves as a reliable equity partner,"
Pauli summarizes.
Forecast for the coming financial year of BayBG
Despite the burdens, the 2020/21 financial year has gotten off to a good start. BayBG currently anticipates investments of €54 million and another positive annual profit. This development will be driven, among other things, by digitalization, the use and development of new technologies, the energy transition, and the sustainable transformation of business models, which are the company's focus.
“BayBG is well equipped to support these financing opportunities with venture capital,”
stresses Peter Pauli. However, these forecasts could become meaningless if the Ukraine crisis escalates further, according to the investment company.
