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IP Group plc – Placing and Open Offer: Pricing announcement

02 Jun 2011

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (DIRECTLY OR INDIRECTLY) IN WHOLE OR IN PART IN, INTO, WITHIN OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

ALL TERMS ARE DEFINED AT THE BACK OF THIS ANNOUNCEMENT, UNLESS OTHERWISE DEFINED HEREIN

IP GROUP PLC
PLACING AND OPEN OFFER
OF 110 MILLION NEW ORDINARY SHARES
AT 50 PENCE PER NEW ORDINARY SHARE

IP Group plc (LSE: IPO) ("IP Group" or the "Company" or "Group"), the developer of intellectual property based businesses, is pleased to announce a proposed Placing and Open Offer of 110 million New Ordinary Shares at the Issue Price of 50 pence per New Ordinary Share, raising gross proceeds of £55 million (approximately £53.3 million net of expenses). Numis Securities Limited (“Numis Securities”) is acting as sponsor, broker, underwriter and financial adviser.

Highlights

£55 million (gross) raised in order to:

  • increase the Group’s overall rate of investment into its portfolio;
  • enable the Group to maintain or increase its stakes through subsequent financing rounds in those post-seed investment opportunities (typically businesses which have received some level of further funding from co-investors external to the Group) which the Board considers to be the most promising;
  • provide the Group with greater flexibility to lead subsequent investment rounds in existing and future post-seed companies, decreasing its reliance on external capital and allowing it to maintain significant minority equity stakes with a view to increasing returns; and
  • continue to expand the Group’s access to, and provide capital to enable the development of, technology originating from its partner universities or other research intensive institutions (including, where appropriate, through the establishment of new partnerships or other collaborative relationships with such institutions).

The Issue Price represents approximately 6 per cent. discount to the closing middle-market price of 53.25 pence per Ordinary Share on 2 June 2011 (being the last business day prior to date of announcement).

Alan Aubrey, Chief Executive of IP Group, said: "A number of the Group’s portfolio businesses have made excellent recent progress towards achieving key commercial milestones. This proposed equity raise will enable the Group to maintain or increase stakes in these post-seed opportunities whilst also increasing its overall rate of investment. Strengthening the balance sheet in this way provides the Group with greater flexibility to lead investment rounds whilst decreasing its reliance on external capital, thereby ensuring that we are able to maintain significant minority stakes in the most promising opportunities. We remain confident that our strategy will generate significant long-term returns for shareholders”.

A Prospectus is expected to be published later today containing full details of how Shareholders can participate in the Open Offer. The Prospectus will be available to Shareholders, free of charge, at the Company’s registered office and on the Company’s website at www.ipgroupplc.com.

The New Ordinary Shares to be issued pursuant to the Placing and Open Offer represent an increase of approximately 43 per cent. in the Company’s existing issued share capital.

The New Ordinary Shares will, when issued and fully paid, rank pari passu in all respects with the Existing Ordinary Shares including the right to receive all future dividends or other distributions declared, made or paid after the date of their issue.

Enquiries (analysts and investors only):

IP Group plc
Alan Aubrey, Chief Executive Officer Tel: +44 (0) 20 7444 0050
Greg Smith, Chief Financial Officer +44 (0) 20 7444 0050
Liz Vaughan-Adams, Communication +44 (0) 20 7444 0062 /
+44 (0) 7979 853 802
Numis Securities Limited
Michael Meade / James Black / Nick Stamp Tel: +44 (0) 20 7260 1000
Financial Dynamics
Ben Atwell / John Dineen Tel: +44 (0) 20 7831 3113

The distribution of this announcement in certain jurisdictions may be restricted by law. Persons into whose possession this document comes should inform themselves about and observe any restrictions on the distribution of this announcement. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdictions. Persons receiving this announcement should not distribute or send it into any jurisdiction where to do so would or might contravene local securities laws or regulations.

This announcement is not for publication, release or distribution, directly or indirectly, in whole or in part, in or into the United States, any of the Excluded Territories or any jurisdiction in which the same would be unlawful. The New Ordinary Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or under any state securities laws and may not be offered or sold within the United States absent registration or an exemption from registration under the Securities Act, or as part of a transaction not subject to, the registration requirements of the Securities Act. The New Ordinary Shares have not been and will not be registered under the applicable securities laws of any of the Excluded Territories and subject to certain exceptions, the New Ordinary Shares may not be offered or sold in any of the Excluded Territories or to, or for the account or benefit of, any resident of any of the Excluded Territories. There will be no public offer of securities in the United States, the Excluded Territories, the United Kingdom or elsewhere.

This announcement is for information purposes only and does not constitute or form part of an offer to sell or issue or the solicitation of an offer to subscribe for or buy, any New Ordinary Shares in the United States or any other jurisdiction in which, such sale, offer or solicitation is unlawful. In particular, this announcement is not for publication, release or distribution, in whole or in part, in or into the United States or any of the Excluded Territories.

This announcement has been issued by the Company and is the sole responsibility of the Company. No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Numis Securities Limited or by any of its respective affiliates or agents as to or in relation to the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefor is expressly disclaimed.

Numis Securities Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for the Company and for no-one else in connection with the contents of this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Numis Securities Limited, or for providing advice in relation to the contents of this document or any matters referred to herein.

The contents of this announcement are not to be construed as legal, financial or tax advice. If necessary, each recipient of this announcement should consult his, her or its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice.

This announcement contains (or may contain) certain forward-looking statements with respect to certain of the Company's current expectations and projections about future events. These statements, which sometimes use words such as "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect the directors' beliefs and expectations and involve a number of risks, uncertainties and assumptions that could cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statement. Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this announcement is subject to change without notice and neither Numis Securities Limited nor, except as required by applicable law, the Company assumes any responsibility or obligation to update publicly or review any of forward-looking statements contained herein. You should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement. No statement in this announcement is or is intended to be a profit forecast or to imply that the earnings of the Company for the current or future financial years will necessarily match or exceed the historical or published earnings of the Company. The price of shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the shares.

Appendix I to this announcement (which forms part of this announcement) sets out the terms and conditions of the Placing.

Pricing announcement can be viewed in the PDF file format (PDF 371KB opens in a new window)