View from City Road: 3i offers a glimmer of hope

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The Independent Online
When naval captains of old wanted to signal their determination to win in battle whatever the odds, they hoisted the red pennant - no prisoners taken or given; death or glory.

3i's decision to launch a high-profile television and press campaign, beginning last night on Channel 4, for its June float might not seem quite so dramatic. It is none the less brave for that.

In another military comparison, the quality Napoleon prized most in his generals was luck. 3i seems to have been cruelly unlucky in its timing. The attempted float two years ago was pulled after the company's shareholders, the Bank of England and the clearing banks, decided they could afford to wait for a stronger market with narrower discounts on investment trusts.

3i may be unique enough to carry it off. It is big enough for the FT-SE 100 yet it gives exposure to 3,500 medium-sized companies. Although it is taking investment trust status for tax reasons, it is quite unlike other trusts, in that it is run as a business with a broad regional network looking out for new deals. If any float is going to get away in these conditions it is 3i. The market may have tired of the seemingly endless torrent of companies seeking a listing, but 3i should be a core holding for every institutional and sophisticated private investor.