IP Group plc - Portfolio company trade sale for up to £357m

13 Jun 2012

IP Group plc (LSE: IPO) ("IP Group" or "the Company" or "the Group"), the developer of intellectual property based businesses, notes the announcement made by portfolio company Proximagen Group plc ("Proximagen"), in which IP Group has a 7.6% stake, that it has reached agreement on the terms of a unanimously recommended offer from USL Pharma International UK Limited, a wholly-owned subsidiary of Upsher-Smith Laboratories, Inc, for a total potential consideration of up to £356.8 million.

Under the terms of the proposed acquisition, Proximagen shareholders will be entitled to receive an initial 320 pence per ordinary share in cash plus up to a further 192 pence in either cash or loan notes by way of a contingent value right ("CVR") which would value IP Group's holding at up to £24.6 million comprising an initial cash payment of £15.4 million and CVRs potentially valued at up to £9.2 million. The cash element would represent a multiple of 35 times the Group's total investment in Proximagen of approximately £0.4 million or a multiple of up to 57 times including the CVRs.

The initial cash payment to IP Group of £15.4 million would also represent a further fair value uplift to IP Group of £5.4m compared with 04 May 2012, being the reference date for the Group's Interim Management Statement.

For full details of the transaction, please refer to the announcement issued by Proximagen this morning. Proximagen was founded in 2003 as a spin-out from King's College London and was floated on AIM in March 2005.

Alan Aubrey, Chief Executive Officer of IP Group, said: "We are delighted that Proximagen has agreed this proposed transaction which is a significant achievement not only for the company itself but also for staff and shareholders including the university. Having originally invested eight years ago, IP Group has been a long-term supporter of Proximagen and we are delighted to have achieved an initial 35 times return on our investment. This is an excellent example of the value that can be created from applying our model to a university spin-out and is also further evidence of the value within IP Group's diversified and maturing portfolio which currently stands at over 60 companies."

For more information, please contact: 

IP Group plc

Alan Aubrey, Chief Executive Officer            

+44 (0) 20 7444 0050

Liz Vaughan-Adams, Communications   

+44 (0) 20 7444 0062 / +44 (0) 7979 853 802

FTI Consulting

John Dineen, Simon Conway

+44 (0) 20 7831 3113

Notes for editors

About IP Group

IP Group is a leading UK intellectual property ("IP") commercialisation company, developing technology innovations primarily from its research intensive partner universities. The Group offers more than traditional venture capital, providing its companies with access to business building expertise, networks, recruitment and business support.

The Company's portfolio comprises holdings in over 60 companies including Oxford Nanopore Technologies, the DNA sequencing development company, Revolymer, best known for its removable chewing gum and Xeros, which has received many accolades for its revolutionary clothes washing techniques with a much reduced requirement for water.

The portfolio includes early stage to mature businesses and has exposure to five main sectors - Energy & Renewables, Medical Equipment & Supplies, Pharma & Biotech, IT & Communications and Chemicals & Materials. To date, fourteen of the portfolio companies IP Group has backed have listed on the AIM market of the London Stock Exchange and one on PLUS Markets.

Founded in 2001, IP Group listed on AIM in October 2003 and moved to the Official List in June 2006. The Group now has long-term partnerships with twelve core universities including those under its commercialisation agreement with Fusion IP plc.

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