Mercia et al. sell Allinea to ARM in £18.1m deal

Mercia, which held a 16.6% stake in the business, stated the sale represented a 73% uplift on its total investment, while Oxford Capital said its stake sold for three times its most recent valuation.

Mercia will receive an initial payment of £2.6m, with up to a further £300,000 due in 18 months subject to closing working capital calculations and warranty claims.

As part of the deal, the business will be integrated into ARM's development group, in which Allinea CEO David Lecomber will have a senior management role.

Since the venture capital firms first invested in Allinea, the company has undertaken an international expansion strategy, opening offices in the US, Europe and Japan.

Previous funding
Mercia led the spinout of Allinea from the University of Warwick in 2009 via its Mercia Technology Seed Fund, with Midven and Oxford Capital also taking part in the deal. In total, the firms provided £400,000 to support the transaction.

In 2015, Mercia's direct investment arm acquired the stake previously owned by the Mercia Technology Seed Fund, following the VC's IPO in December 2014.

Company
Headquartered in Warwick and founded in 2009, Allinea develops tools for use in the integration of software with servers and supercomputers. Its clients include NASA, the US Department of Energy, Shell and Oracle.

In the financial year ending July 2016, the business generated a turnover of £3m and an operating profit of £287,000, according to publicly available records.

People
Oxford Capital – David Mott (managing partner); Tom Bradley (partner).
Mercia – Mark Payton (CEO).
ARM – Javier Orensanz (general manager, development solutions group).
Allinea – David Lecomber (CEO).

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