University spinout lists on AIM
Press release issued: 12 March 2004
The Sulis Seedcorn Fund, a £9 million seed fund owned by a consortium of the Universities of Bath, Bristol and Southampton, today announced that it has sold half of its shareholding in Offshore Hydrocarbon Mapping plc.
The Sulis Seedcorn Fund, a £9 million seed fund owned by a consortium of the Universities of Bath, Bristol and Southampton, today announces that it has sold half of its shareholding in Offshore Hydrocarbon Mapping plc [‘OHM’] through OHM’s admission to the Alternative Investment Market (AIM) of the London Stock Exchange (FLG).
Sulis, set up as part of the government’s university challenge fund initiative and managed by Quester, one of the UK’s leading independent venture capital firms, has achieved a return of over 10 times the cost of its investment, and a return of approximately 20% of the entire fund.
Sulis first invested in OHM when it was initially formed in 2002 to assist with the commercialisation of technology resulting from extensive research from the University of Southampton’s prestigious oceanography centre. The company provides remote electromagnetic sensing services, which are designed to detect the presence of offshore oil and gas. Following the listing, OHM will retain links with the University of Southampton for the purposes of ongoing research and development.
Jamie Brooke, Investment Director at Quester and Investment Manager of Sulis, said: “This is a fantastic achievement for the company. OHM combines world class technology with talented management and is yet another example of the high quality companies deriving from UK universities. This transaction shows that the government’s university challenge fund can be an effective way of supporting the commercialisation of innovative research. This realisation demonstrates that our strategy of working closely with the university sector can produce excellent returns for our investors.”
OHM’s survey method transmits an electromagnetic field into the earth, which is modified by the presence of subsurface resistive layers. These changes in the field are measured and the resulting data is processed to provide information on the resistive structure of the subsurface. Because hydrocarbon accumulations are generally very resistive, this method can indicate the presence of oil and gas in deep water situations, and can detect and map the edges of such accumulations. This reduces the risk of drilling non-commercial exploration wells and can reduce the need for appraisal drilling, thereby creating considerable value for oil explorers.
The Sulis Seedcorn Fund, established in January 2000 as part of the Government’s University Challenge Seed Fund Scheme, is one of 19 University linked funds within which a total of £80 million has been committed from various sources. The Sulis fund was originally established as a joint fund between the Universities of Bath and Bristol. In July 2002, after a successful bid to University Challenge Round 2, it was expanded to include the University of Southampton. The total fund size is now £9 million, which makes it the largest fund of its type in the country.
The Fund, owned by the Universities and managed by Quester, provides support for the early stage commercialisation of research generated by the academic communities of the universities through enhancing the commercial potential of specific products or services as well as the licensing or sale of intellectual property and the formation of spin-out companies.
Quester is one of the UK's leading independent venture capital groups specialising in the provision of finance and management support for growth companies at all stages of their life. Quester’s focus is on early stage investments in information and communication technology, healthcare and life science companies. With its first rate track record, Quester has earned a reputation as one of the best UK based sources of venture capital. The Quester investment team manages approximately £300 million on behalf of major institutional investors, leading UK universities, and five quoted venture capital trusts.