Gateshead-based It’s All Good, which makes pitta chips and tortilla snacks including the Manomasa range, was acquired by the Irish Valeo Foods Group in December 2020. Mercia’s Northern VCTs first invested in the savoury snack manufacturer in February 2014, backing former Union Snacks MD Calum Ryder who set up the company with Michael Weatherhead and Lynn Saul.

It’s All Good was one of four North East firms which this year made the Alantra Food & Beverage Fast 50 and was ranked one of the UK’s fastest-growing privately-owned food and drinks businesses.

Mercia’s sale of OXGENE is a great example of how Mercia’s EIS funds and its balance sheet proprietary capital work together to provide superior returns. The exit, which was announced in March 2021, reaffirms the significant opportunity and value creation potential offered by Mercia’s ‘funds first’ hybrid investment model, which is focused on promising regional companies. We refer to this as ‘the thriving regions’ and it follows the same format as our exit from The Native Antigen Company.

Mercia held a 32.1% direct holding in the business prior to completion, receiving cash proceeds of £30.7million, our largest cash exit to date.

Refract provides sales engagement and conversation analytics that help sales teams improve conversations and close more deals. It uncovers decisive moments in sales conversations for coaching and insight. Key moments can be highlighted with effective feedback, sharing playbook moments and using AI to expose what leads to successful outcomes and top performers in an organisation. Mercia first backed the company in 2016 and made a follow-on investment in 2017.

Mercia achieved a 1.8x return on its original investment, equal to a 20% IRR.

In November 2020, Mercia completed a successful exit of channel service provider, Agilitas IT. The business, which delivers managed inventory solutions and technical, lifestyle and training services, initially found support from Mercia’s Northern VCTs in 2014 with an investment of £6.4million . The transaction is part of a management buyout, with Mercia continuing to back the company with ambitious international growth plans.

Agilitas delivered year-on-year double-digit growth over the Northern VCTs’ tenure through continued innovation and expansion of its channel service propositions and geographic footprint. It was sold to the international private equity investor Perwyn, providing an 8.4x return.

In October 2020, Mercia sold its stake in Clear Review for a cash consideration of £26.0million. The transaction followed a combination of Mercia’s managed funds in 2018 and then a direct investment in 2019. The acquirer, Advanced Business Software and Solutions, is the third largest British software and services company in the UK.

Mercia held a 4.0% fully diluted direct holding in Clear Review at the date of sale and received cash proceeds of £1.0million representing a 2x return on its investment and a 72% IRR. In addition to this direct investment return, the sale will also generate an 8x return on Mercia’s EIS managed fund investment cost and a 122% fund IRR.

Mercia sells stake in biotech EIS portfolio business spun out from the University of Birmingham

 

Specialist asset manager, Mercia Asset Management PLC which has £800.0million of assets under management including more than £50.0million of EIS capital,  has sold its stake in  The Native Antigen Company , a leading producer of infectious disease reagents, to global life sciences tools company LGC .  The sale of The Native Antigen Company is for a total cash consideration of up to £18.0million.

The company, which was spun out of the University of Birmingham and backed by Mercia’s EIS funds since 2013, has generated its EIS investors a multiple of more than eight times the original investment, equivalent to an investment rate of return (IRR) of 36%.

The Native Antigen Company is one of the world’s leading suppliers of antigens that are used in antibody testing kits for and research into emerging diseases. It was one of the first companies to start production of the COVID-19 antigens in February this year and has been heavily involved in the fight against the virus since then. The company also played a key role in supplying products to combat both the Zika and Dengue virus in 2016 and 2018.

Mercia, which across the Group held a 49.4% stake in the business, has supported the company since it commenced trading, investing from both its EIS funds and its own balance sheet. Mercia’s Chief Operations Officer Peter Dines who also acts as Fund Principal for the EIS Funds sat on the company’s board as a Non-executive Director between 2015 until today’s exit was announced.

At the EIS fund level, the Native Antigen Company realisation in addition to previous exits, has returned in excess of two times (2x) invested capital.  This supports the Mercia EIS Fund strategy of creating diversified early-stage technology funds for its investors.

The acquirer, LGC, is a global leader in the life sciences tools sector and hosts the UK National Measurement Laboratory. The company provides a comprehensive range of specialty genomic analysis tools, measurement tools and supply chain assurance solutions, underpinned by leading analytical and measurement science capabilities.

Dr James Wilkie, CEO of University of Birmingham Enterprise, saidWe are delighted that the Native Antigen Company, which started life as a University of Birmingham spinout, has gone on to become one of the world’s leading suppliers of infectious disease reagents, and made such a huge contribution to the frontline fight against COVID-19.  We look forward to hearing about the continued success of the company and its technology following this acquisition.”

Dr Nick Roesen, CEO of The Native Antigen Company saidJoining LGC is a very exciting new phase in the development of the Native Antigen Company. We will be an integral part of LGC’s fast growing clinical diagnostics business and we are excited to join such a well-respected organisation that shares our purpose and mission, and that will support our diagnostic customers by providing even more world-leading products and services.”.

Dr Mark Payton, Mercia Asset Management, CEO, said the deal demonstrated Mercia’s ability to grow value through the life cycle of a company: “Mercia and our university partners play a critical role in creating some of the UK’s most exciting regional businesses scale. Our EIS Funds are instrumental in supporting early stage businesses as has been the case with The Native Antigen Company.  I am proud of the part Mercia has played in the company’s journey, not just as the major capital provider, but also as a critical partner in helping the business to achieve its potential.”

WM Enterprise Limited (WME) is established in 1982 as a venture capital provider.

WME launches Mercia Fund 1 (MF1), a £4.0million evergreen seed fund providing support and capital to spinouts from the Universities of Birmingham and Warwick.

Mercia Fund Management expands university partnerships to eight.

Forward Group establishes a collaboration with WME on the basis of their common interest in supporting and investing in the UK’s leading university spinouts.