Chinese technology firm Tencent is reportedly eyeing all or parts of Invesco’s 11% stake in biotech company Oxford Nanopore Technologies.
According to Sky News, an arm of the Chinese firm is in talks to buy the British gene sequencing firm which is a portfolio company of IP Group and currently playing a key role in developing testing kits for Covid-19.
Seven Investment Management senior portfolio manager Peter Sleep said Invesco is not quite a distressed seller but “would imagine it is an ‘enthusiastic’ seller which could pull the price down a bit”.
“Oxford Nanopore has been the jewel in the tarnished crown of IP Group since it floated in 2007 and it has taken a long time to develop into a sustainable business,” he added.
Invesco declined to comment.
Oxford Nanopore was the largest detractor on stock level to the Invesco High Income portfolio in the first quarter of the year, contributing -2.1% to overall portfolio returns, according to the fund’s Q1 update.
The fund, formerly run by Mark Barnett before he stepped down in May, has been taken over by Ciaran Mallon and James Goldstone. Last week the pair unveiled fewer punchier bets in the Invesco High Income and Income portfolios, according to the funds’ latest factsheets.
Oxford Nanopore was once backed by Neil Woodford in his Equity Income fund and is among the companies recently sold by the fund’s authorised corporate director Link Fund Solutions to US research firm Acacia Research at a steep discount as it winds down the portfolio.
Last month Oxford Nanopore announced that it has raised an additional £48.4m of new capital to support ongoing innovation and rapid growth. It said funding came from both new and existing shareholders in EMEA, US and Asia and adds to a £29.3m capital raise announced on 2 January.
