UK biotech company Oxford Nanopore yesterday confirmed its intention to list on the London Stock Exchange before the end of this year through an IPO which is off to a very good start. The announcement also included news that Texas-based U.S. computing giants Oracle have already committed to buying up £150 million of the new shares being issued as a cornerstone backer of the impending IPO.
The investment agreement forms part of a broader collaboration with the software group. Oxford Nanopore (ON) and Oracle will work together on research around running the former’s gene sequencing technology on the latter’s cloud infrastructure. It is hoped the partnership will help accelerate medical breakthroughs by combining the gene sequencing and genetic analysis strengths of ON with Oracle’s database expertise.
Oracle Vertical Industries executive vice president Mike Sicilia yesterday expressed excitement at the potential of the tie-up, calling Nanopore’s gene sequencing technology “unparalleled in the market”.
He continued:
“By integrating genomic data into our existing applications and cloud infrastructure solutions, we can get these powerful tools into the hands of more people to solve critical health issues faster and improve patient outcomes.”
ON’s IPO was also yesterday confirmed as intended to involve both the issue of £300 million in new shares and a secondary offer which will allow existing investors from the biotech’s private investment rounds over the years to sell some shares should they choose to. It will give company directors with paper fortunes worth tens of millions the opportunity to cash in some of their stakes.
The investment trust Schroder UK Public Private Trust will sell down some of the 3.7% stake it holds in ON because its increasing value means it now accounts for 21.8% of its portfolio. It will sell down some of that stake to increase the trust’s diversification despite remaining
“highly confident in Oxford Nanopore’s prospects”.
ON’s largest shareholder is IP Group, whose 14.4% stake was acquired through the seed funding it offered the gene-sequencing company when it was first formed. It hasn’t made any comment on whether it intends to cash in on some of the significant returns on that initial investment that has since been accrued or not during the IPO.
The biotech still hasn’t made any statement on the price it intends to sell shares at through the IPO but it is believed a valuation of around £3 billion is the target. It was last valued at £2.5 billion while raising £195 million in capital as a private company in May. At a £3 billion valuation, the ON IPO would be one of the year’s five largest for the London Stock Exchange.
Oxford Nanopore’s gene-sequencing technology is helping its customers to conduct groundbreaking scientific research in fields including the human genome, cancer research and virology. The company’s chief executive Gordon Sanghera is, however, convinced that what the company is currently doing only represents:
“The foothills of what is possible, as this knowledge is now starting to translate into ground-breaking ways of using rapid DNA insights. We see the potential for a global internet of living things, a future in which real-time networks of biological sensors can be used to help the broadest of communities.”