Acquisition

RNS Number : 0203S

IP Group PLC

16 December 2016

 

FOR RELEASE ON

16 December 2016

IP Group plc acquires Parkwalk, the UK's largest EIS growth fund manager focused on university spin-outs

IP Group plc (LSE: IPO) ("IP Group" or "the Group"), the developer of intellectual property-based businesses, is delighted to announce that it has agreed to acquire Parkwalk Advisors Ltd ("Parkwalk"), the UK's leading university spin-out focused EIS fund manager, for an initial consideration of £10m. 

Founded in 2009, Parkwalk is the largest EIS growth fund manager focused on university spin-outs, having raised over £100m to date with the majority of funds coming from leading private wealth platforms and having backed over 60 companies across its managed funds since inception. In 2016 alone, Parkwalk committed over £40m to UK university spin-outs and has been a long-term co-investment partner of IP Group, having co-invested over £17m in 14 investment rounds during 2015/2016. Parkwalk is a profitable business and will be immediately accretive to IP Group's operating results.

Parkwalk has significant assets under management, an experienced team and strong links to many of IP Group's existing university partners. Its investment vehicles include the evergreen Parkwalk Opportunities Fund, the University of Cambridge Enterprise Funds, the University of Oxford Innovation Funds and the University of Bristol Enterprise Funds.

Parkwalk will retain its existing investment team and investment decision-making independence post-acquisition.

Alan Aubrey, Chief Executive of IP Group, said: "Parkwalk is a great strategic fit for IP Group being the market leader in the sector with fast growing assets under management run by an experienced team with an excellent track record. The acquisition reinforces IP Group's access to a diversified pool of capital for co-funding the earlier stages of the portfolio while providing a profitable and growing platform to develop closer links with institutional investment platforms. We consider EIS funds to be an increasingly important source of financing for early-stage technology companies and believe Parkwalk's strong links to leading institutional wealth managers and university partners will be beneficial to the Group."

Alastair Kilgour, Co-founder of Parkwalk, said: "The acquisition of Parkwalk by IP Group gives our underlying investors the security of being part of a larger organisation which also brings with it specialist resources and expertise around developing businesses formed around hard science. The strength of IP Group will allow Parkwalk to expand and enhance its EIS fund offerings, helping to boost the UK technology base and returns to investors."

The total maximum consideration payable for Parkwalk by IP Group is £20m over a three-year period. The initial consideration comprises £5.0m payable in cash, £2.5m payable in the form of newly-issued IP Group ordinary shares and £2.5m of cash payable in two equal tranches over two years, subject to certain conditions. The remaining £10m consideration is payable as £5m in cash and £5m in IP Group ordinary shares over a three-year period, subject to Parkwalk achieving certain business performance targets.

A change of controller application has been submitted to the Financial Conduct Authority (the "FCA") and final completion of the acquisition is conditional on approval being received from the FCA, such approval being anticipated within a three-month period.

The information contained within this announcement constitutes inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.

For more information, please contact:

IP Group plc	www.ipgroupplc.com
Alan Aubrey, Chief Executive Officer Greg Smith, Chief Financial Officer Liz Vaughan-Adams, Communications	[phone] [phone]/[phone]
Charlotte Street Partners
Andrew Wilson	[phone]

Notes for editors

About IP Group

IP Group is a leading intellectual property commercialisation company which focuses on evolving great ideas, mainly from its partner universities, into world-changing businesses. The Group has pioneered a unique approach to developing these ideas and the resulting businesses by providing access to business building expertise, capital (through its 100%-owned FCA-authorised subsidiary IP Capital), networks, recruitment and business support. IP Group has a strong track record of success and its portfolio comprises holdings in approximately 80 early-stage to mature businesses across four main sectors -- Biotech, Cleantech, Healthcare and Technology. The Company is listed on the Main Market of the London Stock Exchange under the code IPO.

For more information, please visit our website at www.ipgroupplc.com.

About Parkwalk

Parkwalk is one of the UK's leading technology Enterprise Investment Scheme fund managers. Parkwalk Funds invest in high-growth, knowledge-intensive companies with a focus on technology and innovation primarily sourced from UK universities. Investments are made across the growth curve from early stage through to AIM-listed. The firm also manages a series of early-stage funds in conjunction with the technology transfer offices of the Universities of Cambridge, Oxford and Bristol.

For more information, please visit our website at www.parkwalkadvisors.com

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