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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

RECOMMENDED OFFER
for
FUSION IP PLC
by
IP GROUP PLC
to be effected by means of a scheme of arrangement under Part 26 of the Companies Act 2006

Summary

The boards of IP Group plc (“IP Group”) and Fusion IP plc (“Fusion IP”) are pleased to announce that they have reached agreement on the terms of a unanimously recommended all-share offer to be made by IP Group for the entire issued and to be issued share capital of Fusion IP not already owned by IP Group (the “Offer”). It is proposed to effect the Offer by way of a scheme of arrangement under Part 26 of the Companies Act. IP Group currently owns 20.1 per cent. of the issued share capital of Fusion IP.

Under the terms of the Offer, Scheme Shareholders will be entitled to receive 0.446 of a New IP Group Share for every Scheme Share held. The Offer values each Fusion IP Share at 80.2 pence and the entire issued share capital of Fusion IP at approximately £87.8 million. The Offer represents a premium of approximately 27.4 per cent. to the Closing Price of 63.0 pence per Fusion IP Share on 22 January 2014 (being the last Business Day prior to the date of this announcement).

Both IP Group and Fusion IP have a reputation for building businesses based on intellectual property primarily sourced from leading scientific research institutions and both companies are also recognised as key opinion leaders in this emerging asset class. The IP Group Directors and the Fusion IP Directors consider that the Offer represents an opportunity to create a stronger UK based IP commercialisation company with greater critical mass which the IP Group Directors and the Fusion IP Directors believe will lead to enhanced value for the shareholder base of the Enlarged Group.

Specifically, the IP Group Directors believe that the Offer will provide the Enlarged Group with the following key benefits:

• a stronger combined team as a result of the highly complementary skill sets and experience of Fusion IP’s management, scientific evaluation and business development teams;
• a larger and more diversified portfolio as a result of the inclusion of Fusion IP’s developing portfolio of assets in similar sectors to those on which the Group is currently focused; and
• greater exposure to spin-out companies from Fusion IP’s four partner universities, the University of Sheffield, the University of Nottingham, Cardiff University and Swansea University, and enhanced influence in the selection process for new spin-out companies from such universities going forward.

The Scheme Document containing further information about the Offer and notices of the Court Meeting and the General Meeting will be posted to Fusion IP Shareholders as soon as practicable and, unless the Panel consents otherwise, within 28 days of the date of this announcement.

IP Group also announced today that it intends to raise gross proceeds of up to approximately £75.0 million (approximately £72.9 million net of expenses) through the issue of up to 45,454,856 IP Group Shares by way of an underwritten Firm Placing and non-underwritten Placing, Open Offer and Offer for Subscription at a price of 165 pence per IP Group Share. The Offer is not conditional on the completion of the Capital Raising and the Capital Raising is not conditional on the completion of the Offer.

Commenting on the Offer, Alan Aubrey, Chief Executive Officer of IP Group said:

“Since acquiring an initial stake in Fusion IP in 2009, we have enjoyed an excellent relationship with the team and are delighted to have reached agreement to acquire Fusion IP in full. The Acquisition is highly complementary to IP Group’s core business and will give the combined entity greater breadth of coverage, enabling us to access a wider pool of intellectual property as well as improve our service offering to existing and potential research institutions both in the UK and internationally. Both IP Group and Fusion IP have developed strong track records of building outstanding businesses based on intellectual property and we firmly believe that this transaction will enhance value for the shareholders of both organisations.”

Commenting on the Offer, David Baynes, Chief Executive Officer of Fusion IP said:

“It is well recognised that IP Group has done a fantastic job in developing an innovative approach in the commercialisation of intellectual property as an asset class and we have very much enjoyed working with them since they first invested in Fusion IP in 2009. By becoming part of an enlarged group, I believe we will be able to better maximise the value of our growing portfolio and bring even more value to our university partners and shareholders and to the spin-out companies to whom we provide our capital and expertise. We very much look forward to it.”

Unless otherwise defined, all capitalised terms shall have the meaning ascribed to them in Appendix IV (Definitions) to this announcement.

Enquiries:

IP Group plc	+44 (0) 20 7444 0050
Alan Aubrey, Chief Executive Officer
Greg Smith, Chief Financial Officer
Liz Vaughan-Adams, Communications	+44 (0) 20 7444 0062 / +44 (0) 7979 853 802 [email protected]
Numis Securities Limited	+44(0) 20 7260 1000
Etienne Bottari / Michael Meade / Freddie Barnfield (Corporate Finance)
James Black (Corporate Broking)
FTI Consulting (IP Group’s PR Adviser)	+44(0) 20 7831 3113
Ben Atwell
John Dineen
Fusion IP plc	+44 (0) 114 275 5555
David Baynes, CEO
Stuart Gall, Press Relations
Cenkos Securities plc (Financial Adviser to Fusion IP)	+44 (0) 20 7397 8900
Bobbie Hilliam
Harry Pardoe (Corporate Finance)
Allerton Communications (Fusion IP’s PR Adviser)	+44 (0) 20 3137 2500
Peter Curtain

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