b'24 Mercia Asset Management PLC Annual Report & Accounts 2022Our portfolioWayne ThomasManaging Director,Mercia Private Equity FundsWe work in partnership with profitable, cash-generative businesses that have attained a strong market position, and help them to maximise and sustain their local economic impact.Private EquityMore than just investment Our traditional focus is on costThe confidence in our expertise Supporting the growth of exceptionaleffectiveness and operational efficiency.displayed by local authority pension enterprises that generate economic andSupporting a business such as UKfunds has been justified within a societal benefits for the communitiesLandscapes demonstrates the morerelatively short timeframe. The they serve is central to our missiontypical conventions of our investmenthistorical performance of our funds at the Mercia Private Equity Fund.strategy, but we also believe thatcoupled with the continued maturation Businesses that want to do moretechnology-enabled growth andof our Complete Connected Capital are the source of our inspiration anddisruption can be strong drivers ofsolution have enabled our strong value-future vision. Designed to optimisevalue. Our continued support of ParkViabased Private Equity fund to deliver growth and diversification potentialand the investment that leveragedimpactful investments. This is of vital within the region, our Private Equitythe buyout of imail comms serve asimportance to our LPs and will be the fund invests in profitable, later-stage,examples. They demonstrate that inbasis of our next fund-raising strategy.purpose-led SMEs across the UK. Assituations where digital innovationA small enterprise might initially require part of our investment criteria, we startcan transform industry, we are ablea small investment, but as we are not by identifying management teams thatto source the insurgents. We can alsoconstrained by a timeline before exit,share a common set of goals and valuessupport the incumbents, helping towe can commit to a long-term plan of with us. We work in partnership withreinforce their competitive advantage. value creation. This will, of course,profitable, cash-generative businessesallow us to generate the best returnsthat have attained a strong marketOur exit from Blue-i Group Ltd,for our investors.position and help them to maximise andcompleted in March, generated an sustain their local economic impact.overall return of 1.6x cost. ContinuedThe long-term economic effects of improvement in the trading prospectsCOVID-19 have yet to be determined. of many of our selected portfolioGlobal inflation and supply chain companies has resulted in an upgrade indisruptions are coupled with a valuation across the portfolio. shortage of skilled labour. These, and other current factors, have shaped an investment landscape that requires new forms of value creation. We have c. 48 m the expertise, experience and resources needed to carry this out, and can invest across a broad range of economic sectors and asset classes. This presents new prospects and opportunities for us.FuM'