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REGINA, Saskatchewan (September 4, 2013) — SaskWorks Venture Fund has received confirmation from the Government of Saskatchewan that the following major amendments to the Labour-Sponsored Venture Capital Corporations Act and the associated Regulations will be tabled and ratified by the Provincial Legislative Assembly in its upcoming fall session:
- The LSVCC Annual Fundraising Limit has been decreased from $55 million per fund to $40 million per fund, effective immediately. Given that SaskWorks has become fully-subscribed each tax year since 2010, the risk that the fund will become “sold out” prior to shareholder demand being satisfied will be amplified for the 2013/2014 sales season.
- LSVCC Funds will be mandated to gradually increase their level of innovation sector exposure to 25% of annual net capitalization (annual capital raised less annual capital redeemed, multiplied by funds’ standard pacing requirements), with the staged increments first taking effect in 2014/2015 (15%). Eligible innovation sector investments will include companies operating within the clean/environmental technology, health and life sciences, crop sciences, industrial biotechnology, information and communication technology, alternative energy industries; or, companies developing and/or employing value-added processes or technologies in Saskatchewan’s traditional sectors (i.e. energy, agriculture, manufacturing). The mandated level of investment exposure is consistent with current market demand for innovation-focused capital in Saskatchewan and SaskWorks is confident that it will require no material changes to its investment strategy and proven underwriting and due diligence processes in order to comply with this requirement.
Federal Consultation Update
SaskWorks actively participated in the Federal Government’s consultation process relating to the proposed phase-out of their LSVCC tax credit participation. A decision is expected this fall.
If the sunset period proceeds as originally proposed, the Federal Government’s investment tax credit will gradually decrease from 15% to nil between 2015 and 2017.
For further information please contact:
Randy Beattie, Chief Executive Officer
Rob Duguid, Vice President, Chief Financial Officer and Corporate Secretary at