Mercia Asset Management PLC (AIM:MERC) has been appointed to manage the capital of three funds of the British Business Bank, the state-owned lender used to support small and medium-sized enterprises.
All three of the British Business Bank’s assets under Mercia’s control are part of the Midlands Engine Investment Fund II, a newly launched scheme to support businesses with levelling up in the region.
These new funds represent a total of £207 million in new funds under management and will be focused on the East Midlands, Southeast Midlands, and West Midlands regions.
Some £44 million under management will be debt lent to the West Midlands, while the remaining £163 million will be equity invested into the region.
The funds are expected to be managed from Mercia's offices in Birmingham, Nottingham, and Henley-in-Arden.
Mark Payton, chief executive of Mercia, said: "We are really delighted that, following a highly competitive procurement process, the group has been selected by the British Business Bank.
"We are passionate about investing in the UK's regions to support the next generation of high-potential businesses and by growing our equity and debt funds under management, we can do this at greater scale and pace.
“It is also pleasing that Frontier Development Capital, acquired by Mercia in December 2022, has been awarded its first Midlands Engine Investment Fund mandate.”
Frontier Development Capital will manage the £44 million in debt, while Mercia Regional Ventures will manage the equity.
Shares in Mercia were up 5% on Thursday.