RIEDC Launches New Alliance with Two Area Business Development Companies
February 26, 2008 | Print this page | Share This | Email this page
Alliance to bring $200 million in growth capital products to local marketplace
The Rhode Island Economic Development Corporation (RIEDC) today announced a new strategic alliance with the Business Development Company of Rhode Island (BDCRI) and the Business Development Company of New England (BDCNE). RIEDC joins with the BDCs in a partnership to bring the financing tools of two of the most recognized business development organizations in the United States to an expanded number of Rhode Island businesses with more that $200 million in growth capital products available to invest.
The financing products offered by the joint venture compliment existing RIEDC programs and include the capability to provide up to $2 million in junior debt and up to $5 million in mezzanine and equity capital per transaction. The joint venture will also be actively investing in Rhode Island companies from a new $30.0 million mezzanine fund, MB Capital III.
The BDC alliance is a key element of RIEDC's economic growth plan and an important step to modernize the state's financing portfolio so that it better serves local growth companies well positioned to create high-wage jobs.
"Access to growth capital is an important catalyst for job creation, says Governor Donald Carcieri. "Companies ready to grow in Rhode Island often face difficulties accessing the growth capital they need to expand and create new jobs. RIEDC's new alliance is an important step to increase the availability of growth capital for Rhode Island companies. This alliance will help us achieve our economic development vision to create a 21st century innovation economy that produces higher wage job opportunities for all Rhode Islanders."
The alliance will create a close working relationship between the organizations and contemplates establishing a host office at RIEDC to meet with prospect companies. The BDCs will also work with RIEDC on ways to bring the successful micro lending Capital Access Program to Rhode Island.
Increasing the availability of growth capital to Rhode Island businesses is one of the key strategies the RIEDC is pursuing as part of its Economic Growth Plan. The goal of the plan is to provide Rhode Islanders with more high-wage job opportunities by increasing the percentage of Rhode Island jobs paying above the national average wage from 40 to 60 percent.
"Our alliance with the RIEDC reflects all of our organization's interest in the Rhode Island marketplace and our shared vision that increasing access to growth capital within high-wage industry sectors is essential to long-term economic prosperity," said Kenneth Smith, president, BDC New England. "Our alliance with RIEDC will allow both organizations to support new growth opportunities and work together toward a common goal of transforming the state's economy," added Garrett Hunter, president of BDCRI.
"Now more than ever, Rhode Island must effectively compete in a global economy where innovation and knowledge are the primary drivers of economic growth. The companies best positioned to grow in this economy and produce high-wage jobs for Rhode Islanders will benefit from this important alliance," says RIEDC Executive Director Saul Kaplan. "We are excited about the alliance and look forward to bringing new growth capital to Rhode Island companies."
