IP Group, a prominent tech investor, recently sold shares in its portfolio, amounting to £15m.
- The sale involved nine of its portfolio companies, contributing to a larger £45m share buyback programme.
- Shares were sold at a slight premium to previous valuations, representing less than 10% of IP Group’s holdings in each firm.
- IP Group shares saw a 3.7% increase in early trading following the announcement.
- CEO Greg Smith emphasised the transaction’s role in strengthening investor relations and maintaining portfolio quality.
IP Group, a leading player in the tech investment arena, has strategically sold shares from its portfolio, generating a substantial £15m. This move is part of a broader strategy to bolster its £45m share buyback programme. By divesting portions of its stakes in nine portfolio companies, IP Group aims to optimise shareholder returns.
The sales were executed at a ‘small overall premium’ relative to earlier valuations in the year. On average, the shares sold accounted for less than 10% of IP Group’s holdings in each respective company. This strategic decision underscores the firm’s approach to maintaining a balanced and lucrative portfolio.
Following the announcement, IP Group’s share price rose by 3.7% to 50 pence in early London trading, reflecting positive investor sentiment. CEO Greg Smith commented on the development, stating, ‘This transaction creates new relationships with a group of long-term investors and further validates the quality of the Group’s portfolio and our valuation approach.’
Smith expressed confidence in the cash generated from recent exits, stating that these transactions consistently achieved or surpassed carrying values. He underscored the continued appeal of the company’s portfolio and its potential to deliver significant impact and returns for shareholders.
The board of IP Group believes that the current share price does not fully represent the value of the Group’s holdings, hence the allocation of all proceeds from this sell-down to the ongoing buyback initiative. This decision aligns with the firm’s belief in the underlying value and growth potential of its investments.
Since the start of the year, IP Group has realised approximately £57m from various asset sales, marking a nearly 50% increase compared to the previous year, indicating a recovery in startup valuations. The firm is poised to earn an additional £134m from the sale of Featurespace, a specialist in real-time AI payments protection technology, acquired by Visa.
As of the end of November 2024, IP Group reported £176m in gross cash and deposits. Its holdings in listed companies stand at £167m, covering around 80% of its market capitalisation at that time.
IP Group’s strategic asset sales and share buyback efforts underscore its commitment to delivering value and growth for its investors.
