Investment policy
> Since Admission to Aim, the Company has slightly revised its investing policy in accordance with the transitional provisions of AIM Notice 33.
These revisions are not considered by the Board to amount to a material change in the overall objective and risk profile of the existing investing policy.
The Company has been established with the objective of becoming a major pan-European design-focused investment company.
The Directors intend that the Company will make investments in luxury, contemporary design orientated companies with a particular focus on manufacturers and retailers of luxury furniture and design-enabled products and appliances, including companies and businesses which the Directors believe are under-capitalised, such as small or family run businesses which are unable to reach their full potential, and as such have the potential to create value for Shareholders.
In addition, the Directors intend that the Company will invest in companies providing advisory services in the fields of architecture and design.
The Directors intend that the Company will make direct investments in and directly manage its investments in design related companies and projects, as well as making investments in such companies and projects through various investment vehicles.
The Directors collectively have considerable experience investing, both in structuring and executing deals and in raising funds.
The Directors will use this experience to identify and investigate investment opportunities, and to negotiate acquisitions.
Wherever necessary the Company will engage suitably qualified technical personnel to carry out specialist due diligence prior to making an acquisition or an investment.
The Directors may offer new Ordinary Shares by way of consideration as well as cash, thereby helping to preserve the Company's cash for working capital and as a reserve against unforeseen contingencies including by way of example, and without limit, delays in collecting accounts receivable, unexpected changes in the economic environment and unforeseen operational problems.
The Company may in appropriate circumstances, issue debt securities or otherwise borrow money to complete an investment. There are no borrowing limits in the Articles of Association of the Company.
There are no restrictions in the type of investment that the Company might make nor on the type of opportunity that may be considered other than set out in this paragraph.
As the Ordinary Shares are traded on AIM this provides a facility for shareholders to realise their investment in the Company.
In addition, the Directors may consider from time to time other means of facilitating returns to Shareholders including dividends, share repurchases, demergers, and schemes of arrangements or liquidation.
Investment philosophy
> investment targets
The Company shall invest into aspirational high-end/luxury design furniture brands and retail concepts, i.e. brands and concepts responding to the same customer’s inner aspirations as design and luxury:
- retail of high-end/luxury contemporary/modern/design furniture and design-enabled products and appliances;
- editing and publishing of high-end/luxury contemporary/modern/design furniture and design-enabled products and appliances.
All development stages except start-up, with a view to accelerate the growth of businesses and to breed concepts and products that may be within the core of tomorrow’s larger high-end/luxury furniture design industry:
- differentiated concepts or brands, recognisable by the final customers (modernity and innovation, image of tomorrow’s lifestyle, perceivable quality and status image);
- high growth potential (internet based concepts);
- marketable brand name, offering a promising outlook for internationalisation and product diversification.
The Directors intend that the Company's interest in a proposed investment may range from a minority position with strategic control up to 100% ownership with the objective of creating a portfolio of strategically integrated companies.
These proposed investments may be made through a direct interest in a design company or project, an indirect interest through a partnership, joint venture or through quoted or unquoted companies.
The Directors intend on identifying and investing in investment opportunities which they believe show excellent growth potential on a stand-alone basis and which would add value to the Company either through the expertise of the Company‟s personnel or through ongoing funding.
> privileged transactions
Due to the characteristics of its investment universe, designcapital investment strategy will be particularly hands-on and will mainly include a number of small sized transactions (aggregation and build-up).
Such transactions are not likely to be highly sophisticated, and will mostly take the form of:
. classic buy-out and LBO transactions;
. growth and development capital transactions;
. restructurings, turnarounds, or “special situations” transactions.
