European venture capital player 3i has decided to close its Dublin office, citing slow development of the Irish equity market.
In a statement issued last night, the company said: “The reason is due to slower than expected development of the Irish private equity market, which has been impacted by the general economic slowdown.”
“3i has completed a number of investments to date in Ireland and believes that further opportunities may arise in the future as the local private equity market develops. However, in the near term we do not see sufficient activity to support a dedicated local presence,” said Clive Austin, head of 3i’s Irish operations.
3i, which specialises in supporting hi-tech companies, established its office in Dublin in July 2001, a time that many argue was the tail-end of the tech boom in Ireland. The US dotcom bubble had already burst a year earlier.
The closure of the office comes at a time when the health of the Irish private equity market has been increasingly under the spotlight. While many argue that some €600m in funding has been raised in the past year and that Ireland in this regard is one of the most highly capitalised private equity economies in Europe, venture capitalists themselves have been cautious in their outlook going forward and have come under criticism for being slow to invest in tech companies. A survey released by the Irish Venture Capitalists Association earlier this week found that while 80pc of venture capitalists here say they will invest more in new projects, some 14pc said they would invest less.
3i, which was founded more than 50 years ago, has invested some £15bn sterling in global businesses. The company had an office in Dublin during the Eighties but closed it for similar reasons. However, impacted by the global downturn, the company last week was forced to write down the value of its technology investments by some £360m sterling.
By John Kennedy