Schroders sells portfolio of seven assets to Rosetta for £49m

The purchase price represents a discount of 22% on the aggregate valuation for those holdings announced in the Q3 2020 net asset value, as of 30 September 2020.

The acquirer is deploying from its sixth fund. Rosetta has also agreed to pay an additional £2.9m, which represents the value of certain follow-on investments.

The portfolio consists of Schroders' entire holdings in Carrick Therapeutics, Mission Therapeutics, PsiOxus Therapeutics and Mereo BioPharma, and partial holdings in Inivata, Immunocore and ReNeuron. Schroders will retain stakes in the latter three companies.

Immunocore has recently filed for an IPO, and, in light of this news, Schroders has agreed an earn-out provision under which the vendor might receive an additional payment of up to £5m subject to the stake in Immunocore exceeding certain thresholds upon Rosetta's future exit of the company. Rosetta has agreed to a six month lock-up period, upon the IPO.

A significant proportion of the expected proceeds from the deal will be used to pay down Schroders' outstanding debt under its credit facility, which has recently received an extension of two years, while the remainder will support some of its portfolio companies with follow-on capital.

People
Schroders UK Public Private Trust – Susan Searle (chair); Tim Creed, Ben Wicks (portfolio managers).

Advisers
Vendor – Stephenson Harwood (legal).

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