The banking group will take minority stakes in local and unlisted commercial, industrial, and technological companies with at least 10 million in revenues.
Photo: BGL BNP Paribas’ headquarters in the Kirchberg district in Luxembourg / Credits © Shuttestock
BGL BNP Paribas intends to make long-term investments in unlisted Luxembourg companies, in the commercial, industrial, and technological sectors, through its new project – BGL BNP Paribas Development.
With this new program to support the local economic fabric, the bank explained in a recent press release that it “intends to participate in their internal or external growth projects and support them in the transfer of companies through the acquisition of minority stakes.”
High admission ticket
For interested companies however, the entry fee is high: they must have a turnover of at least 10 million euros and present profitable activity and growth prospects, said the financial institution. “The objective is to provide resources to companies over the long-term, so as to enable them to accelerate their growth in the local or international market.”
Investments will take the form of minority stakes – via existing or new shareholders – over a period of five to ten years. The bank plans to invest 50 million euros over the next five years.
“This new activity is in line with the group’s strategy to double the amount devoted to direct investments in small and medium-sized and mid-sized companies,” said Béatrice Belorgey, BNP Paribas Group’s Country Manager in Luxembourg.
How about investing in startups?
A similar courageous initiative by the bank for start-ups, SMEs, and independent entrepreneurs is now expected.
At the beginning of January, the bank closed the doors of its incubator, Lux Future Lab, forcing domiciled startups to look for alternative accommodation.
In terms of support for startups, the Luxembourg financial institution is positioned as a financial partner via its Innovation Pole department.
Specialized in the ICT, Fintech, circular economy, and Greentech sectors, it primarily offers its own banking products and services (financial leasing, factoring, cash management), and of course, a current account, a V PAY debit card, and a credit card.
On the investment side, the bank protects itself via the InnovFin guarantee program for credits and leasing, set up by the European Investment Fund in partnership with the European Commission.
This program aims to reduce its own lender risk, rather than to actively finance the innovative projects of startups, SMEs, and independents.
Article originally published on Silicon Luxembourg