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SA state fund seeks Blue Sky replacement

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The South Australian government’s $50 million venture capital fund has commenced a search for a new fund manager to oversee its investments, following the collapse of its former manager Blue Sky.

An independent committee that manages the fund and chaired by businessman Raymond Spencer is hunting for its replacement venture capital fund manager, which the government has said will ideally overlook the current team in place.

In July 2017, the Labor government had entered into an agreement with Blue Sky Venture Capital (BSVC) to manage the SA Venture Capital Fund (SAVCF). 

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BSVC’s parent company, Brisbane group Blue Sky, entered receivership in May, following a turbulent year including an overhaul of its board and management, a falling share price and the breach of its $47.7 million loan facility from US-based Oaktree Capital Partners.

According to the state government, receiver KordaMentha has since indicated to the SAVCF committee that Oaktree has no interest in the venture capital component of the Blue Sky business. 

SA treasurer Rob Lucas said based on advice from the committee, the preferred model will have the Adelaide-based BSVC team continue to manage the SA Venture Capital Fund, but as employees under a new fund manager. 

“I am advised the team has continued to manage the SA Venture Capital Fund effectively – notwithstanding the events that have impacted its parent company over the past year – and has met all its obligations under the terms of the management agreement,” Mr Lucas said.

“In the past two years they have evaluated more than 350 investment opportunities and actively manage $6 million into three investments in the fund (Myriota, Kid Sense and Fivecast) leveraging a further $18.1 million in private sector capital. 

“The independent SAVCF management committee expects this level of activity to continue.”

The management committee will engage in an expression of interest and proposal process in its hunt for the replacement.

 

SA state fund seeks Blue Sky replacement
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Sarah Simpkins

Sarah Simpkins

Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth. 

Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio. 

You can contact her on [email protected].

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