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Vale International to be link for Asia-funded tech deals

One for the summer watch-list is Vale International Group, which is expected to make its stock market debut later this summer.

Via a standard listing it expects to raise £1.4mln and is understood to have around £500,000 of the funds already committed.

Chaired by Patrick Tsang, a lawyer and business angel, who has worked in private equity, technology investment and property, Vale’s aim is to become a channel through which European businesses can attract Asian investment and vice versa.

The turmoil caused by Brexit, Tsang contends, has created opportunities for investors shrewd and brave enough to grasp them.

The weakness of the pound, for instance, makes UK companies much more “attractive” (cheaper to acquire) to investors from Asia and the US, he points out.

“I believe London will always be an international capital for capital,” the Vale boss told Proactive Investors.

“It will recover irrespective of the decision to leave. The strategy we have is: we are looking for global businesses, not just ones focused on Europe, but the current backdrop helps our cause.”

Tsang brings with him a wealth of experience garnered from his work with Global Angels, an Asia-focused start-up incubator, and as the head of the private equity arm of ecommerce firm Quest Strategies.

That means he is tapped into a network of Asian and European high-net-worth and professional investors ready to back the right sort of transaction.

“The idea is to create a link, a bridge, a conduit for Asian money looking for investments in Europe or vice versa,” said Tsang. 

“Because of the China slowdown and the way Asia is operating at the moment we think there are a lot of good businesses to buy in Europe where we can take advantage of currency movement (particularly the pound’s depreciation) to get good value.” 

Through Vale he is interested in acquiring companies in the emerging fin-tech space. He is currently assessing three-to-five serious opportunities, ranging from £5-£20mln in value.

Tsang has an exacting list of criteria for the prospective purchases.

“We are looking to invest in tech and app related businesses,” he explained.

“In the tech area we are definitely looking at blue sky potential but at the same time we want something that already has existing revenues - and profits. I think that should be interesting to shareholders.”

Vale won’t be doing deals just for the sake of it. It will wait at least six months after the first transaction before embarking on the second; however there’s no shortage of opportunities.

“We need to make sure the first [deal] is a success before we embark on another acquisition,” said Tsang. 

“The first one goes well, then we have the deal flow for the second and third one with funding.” 

Tsang has appointed Simon Retter, a veteran of the AIM mining sector with corporate finance experience, as chief financial officer. Meanwhile, Malcolm Groat, finance director of junior market-listed TekCapital, is a non-executive director of Vale.

“I think we bring a little more entrepreneurial flair than the usual financial and technical people,” said Tsang.

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