REG - Schroders Cap Glbl - Sale of Araris Biotech

Schroders Capital Global Innovation TrustAnnouncement

17/03/2025 09:45

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250317:nRSQ9330Aa&default-theme=true

RNS Number : 9330A  Schroders Capital Global Innovation  17 March 2025

 

 

Schroders Capital Global Innovation Trust Plc

Sale of Araris Biotech

 

Schroders Capital Global Innovation Trust plc (the "Company") is pleased to
announce that its portfolio company Araris Biotech AG ("Araris"), a Swiss
biotechnology company developing next-generation antibody drug conjugates
("ADCs"), on 17 March 2025, has entered into an agreement to be acquired by
Taiho Pharmaceutical  Co. Ltd., at a purchase price of $400 million upfront,
with the potential for additional milestone payments of up to $740 million.
Following necessary procedures, the acquisition is expected to be completed in
first half of 2025.

Schroders Capital was among the first investors in Araris as part of its CHF
2.5m seed round in 2019. In October 2022, the Company made a CHF 3.0m (£2.6m)
investment into Araris, to support the further development and advancement of
Araris' ADC candidates, created using its proprietary linker technology. The
upfront will generate a distribution of approximately $24.3m (£18.7m) at
closing (7.2x upfront gross multiple of invested capital ("MoIC")), and
potential additional distributions of up to $43.6m (£33.7m) subject to near
and long-term milestones (20.2x total gross MoIC).

Based on the valuation implied by the up-front purchase consideration,
near-term milestone potential and accounting for specific closing adjustments
according to the Company's valuation policy, the estimated value of its
holding would approximately be £19.5m. This represents a positive valuation
revision of £16.7m compared to its last published carrying value of £2.8m as
of 30 September 2024. The overall impact on the Company's net asset value will
be evaluated as part of the Company's 31 March 2025 net asset value
publication.

The full upfront proceeds from the sale are expected to be added to the
previously disclosed intended initial return of capital, increasing the total
from approximately £10 million to £28.7 million, and hence the initial
return of capital will take place shortly following the receipt of initial
proceeds from this transaction.

Schroders Capital have made 19 new investments since being appointed
Investment Manager in 2019. This is the fourth exit that builds on the exits
of Carmot Therapeutics at 3.2x gross MoIC, Tessian at 1.1x gross MoIC and
Anthos Therapeutics at 1.9x gross MoIC (with the potential to increase to 3.4x
gross MoIC with milestones). This brings the realized track record of new
investments made by Schroders Capital to 3.3x gross MoIC (with potential
upside through further earnouts to 6.3x gross MoIC).

Tim Creed, Lead Portfolio Manager, and Harry Raikes, Co-Portfolio Manager
commented: "We chose to invest in Araris Biotech based on its compelling
platform, with potential best-in-class antibody drug conjugates ("ADC's") with
superior design, high linker solubility and simple manufacturing that address
the shortcomings of current generation ADCs. Overall, the company fulfilled
our four key investment criteria: a strong management team, a significant
market opportunity, high quality science and reputable co-investors. We are
delighted by the news of this sale which reflects the unique nature of the
Araris platform."

Enquiries

Schroder Investment Management Limited

Katherine Fyfe (Company Secretary)    0207 658 3136

Charlotte Banks (Press)                          0207 658 9063

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  DISUBOKRVWUOARR