Mercia Technologies gains from GBP18 million sale of Allinea to ARM

R Sahota Posted On December 23, 2016

Warwickshire based tech VC Mercia Technologies has confirmed the initial proceeds of GBP2.6 million from the sale of its investee company Allinea Software Ltd to semiconductor company ARM Ltd, part of recently acquired ARM Holdings PLC.

Allinea is being sold to ARM for a cash consideration of up to GBP18.1 million. Mercia, which held a 17% holding in Allinea as at September 30, will receive initial proceeds of GBP2.6 million with a further GBP300,000 proceeds held in escrow for up to 18 months.

Mercia said the proceeds are a 73% uplift on its total investment cost of GBP1.5 million, and that it will recognise an immediate realised gain of GBP700,000 on the GBP1.9 million holding value of the investment as at September 30.

“The sale of Allinea to ARM is a testament to the value held within our investment portfolio and will enable Allinea to accelerate its development and reach within the growing high performance computing markets, as well as achieving greater exposure in adjacent segments such as machine learning. As a Midlands-based business, this is further evidence of the hidden value we are able to unearth from the UK regions and our university partnerships,” said Mark Payton, chief executive officer of Mercia Technologies.

Japan’s SoftBank Group Corp completed the acquisition of former FTSE 1100 constituent ARM Holdings in September.