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Imperial leads university dash to cash in on appliance of science

The institution enjoyed a £10m windfall as it cashed in part of its shareholding in namesake Imperial Innovations

London’s Imperial College yesterday became the latest institution to profit from a growing appetite to commercialise the best of Britain’s skills in academic research and development.

The institution enjoyed a £10m windfall as it cashed in part of its shareholding in namesake Imperial Innovations – the fund that invests in bringing brain power to market.

Imperial College sold 2.5m shares at 400p, reducing its stake in the company from  30.2 per cent to 20 per cent. The sale came as Imperial Innovations completed a £150m placing of new shares, also at 400p, to fund investment by companies with which it is involved and new prospects.

Chief executive Martin Knight said the cash would help to attract new investment opportunities and help it back existing investments from inception to maturity.

He added: “We have identified opportunities to increase the capital deployed in a number of our leading portfolio companies which, in aggregate, are seeking to raise over £100m from investors over the next 12 months.”

He highlighted Circassia, a company based on Imperial College technology, which is developing treatments for cat allergies and was floated on the stock market in March, netting the fund group a profit of more than £8m.

Mr Knight added: “The strengthening of our balance sheet will greatly enhance our ability to attract high-quality investment opportunities.”

It has been a busy spell for universities seeking to spin out the technology companies they have founded. Applied Graphene Materials gained attention after the Durham University-originated firm came up with a method of producing the new “miracle” material in commercial quantities.

Following it on to the stock market was Arria NLG, a company whose data analysis techniques were developed at Aberdeen University and are used in predicting the weather and monitoring the performance of oil rigs.

Imperial Innovation’s new share placing received substantial backing from star fund manager Neil Woodford, whose former funds at Invesco Perpetual and his own new Woodford Investment Management took 15m and 12.5m of the 37.5m new shares being placed. Another existing shareholder, Lansdowne, the alternative investments fund manager, also acquired another 5.1m shares in the placing.

Imperial has expanded from investing in the single college’s research to include Oxford and Cambridge Universities and University College London. It now holds stakes in 96 companies. In the last full year (to July 2013) Imperial invested £22.2m and in the next six months £17.8m in its portfolio companies.

IP Group, another commercialisation vehicle, recently announced it was spreading its wings by signing a partnership to develop early-stage companies with Princeton University in New Jersey.

A report last October by Sir Andrew Witty, the chief executive of drugs giant GlaxoSmithKline, said universities had the capacity to build whole new export-friendly industries if they worked together.