Bottom Line: Canny Candover steps up the pace

IF YOU have been through the last recession and made money from venture capital, such as Candover Investments, a half- point on base rates is neither here nor there. This is a company with long lead times. The results of its 1989 venture capital fund, set up to finance large buyouts, are now coming through strongly. Four flotations and sales in the first half - names such as Midland Independent Newspapers - meant net asset value rose 6.5 per cent against a 13 per cent fall in the FT All Share index.

There are another 10 investments still in the 1989 fund portfolio and the pace of realisations will be stepped up next year. The effect will not be dramatic, since most of the gains are reflected in revaluations before flotations.

Candover is putting the finishing touches to its replacement venture fund, which has so far attracted pounds 222m from institutions, including US pension funds. Another substantial chunk is expected to come in by the closing date in November. Candover itself is committed to putting at least pounds 65m in the new fund.

This is one of the few investment trusts that does not trade at a discount to net asset value. The 1994 fund is also starting at a better point in the cycle than the last, which began just before the recession. Candover looks a good long- term bet.