Investment Management Update

RNS Number : 6470P

Intl. Biotechnology Trust PLC

13 February 2023

 

This Announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation EU 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018.

13 February 2023

INTERNATIONAL BIOTECHNOLOGY TRUST PLC

("IBT" or the "Company")

Investment Management Update

The Board of IBT and SV Health Managers LLP ("SV Health"), the Company's Fund Manager and AIFM, are today announcing that SV Health has informed IBT that it wishes to focus on its core healthcare venture business.

The Board is pleased that IBT's differentiated strategy, which offers investors access to the sector using an actively managed, diversified approach and also an attractive dividend yield, has been delivering strong returns; and believes that the investment case for global biotechnology is compelling.  IBT has performed well under the management of the joint lead fund managers at SV Health, Ailsa Craig and Marek Poszepczynski, who have expressed their willingness to continue as joint lead managers of the Company in a different capacity.

The Board has instructed its advisers to commence an independent process to review the Company's options to ensure continuity of shareholders' exposure to the sector for the long term. A further update to shareholders will be provided in due course. 

IBT and SV Health have agreed that SV Health's fund managers Ailsa Craig and Marek Poszepczynski will continue to manage the quoted portfolio and Kate Bingham and Houman Ashrafian will continue to manage the unquoted assets of IBT during this process.

Kate Cornish-Bowden, Chair of IBT, commented: "IBT has worked with the SV Health business since 2001 and we would like to thank the team for their successful management of the Company over that period. In the near term the Board will consult major shareholders regarding the Company's future, and in due course we look forward to updating shareholders on specific proposals."

Dame Kate Bingham, Managing Partner of SV Health, commented: " SV Health is now managing $2.2 billion of private healthcare assets across its group and the time has come for us to focus on these core strategies. We will be working with the Board of IBT to ensure a smooth transition over the coming months and look forward to a continued relationship with IBT as an investor in SV Health's venture and crossover funds. "

In accordance with the provisions of the investment management agreement between the parties (the "IMA"), SV Health has given the Company notice of termination, which will take effect on 9 February 2024 unless agreed otherwise by both parties. In the light of the review process discussed above, the IMA has been amended to acknowledge that should the Company pursue a course of action prior to 9 February 2024 under which it will no longer require SV Health to manage IBT, good faith negotiations will be entered into to agree termination of the IMA on an earlier date.  It is intended that SV Health will provide ongoing investment management services to IBT following termination of the IMA in respect of its current portfolio of unquoted assets in consideration for payment of a performance fee on the same terms as set out in the IMA.

Additionally, the IMA has been amended to clarify that in circumstances where SV Health gives notice to terminate the IMA, SV Health will be entitled to the annual performance fee calculated until the termination date of the IMA (capped at 2% of NAV) and any deferred performance fees (capped at 4% of NAV) subject to a cap on the aggregate amount payable on termination of 4.99% of NAV. The previous position under the IMA was not clear and could be interpreted such that, in the circumstances where SV Health gives notice, SV may not be entitled to a performance fee in respect of the performance period ending on the termination date nor any deferred performance fees outstanding on the termination date.  SV Health is a related party of IBT under the Listing Rules and this amendment represents a  smaller related party transaction with SV Health in accordance with Listing Rule 11.1.10 R.

For further information, please contact:

Corporate Broker - Numis

Nathan Brown  [phone] / [phone]

Vicki Paine  [phone] / [phone]

Financial PR - KL Communications

Charles Gorman    [phone] / [phone]

Company Secretary - Link Company Matters

Indu Shastri  [phone]

LEI: 213800N1QUJ744P76D11

 

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