Investor in Oxford University spinouts raises £250m

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Oxford Science Enterprises, the investment company that backs businesses spun off from academic research at the University of Oxford, has raised £250m to support breakthroughs in science and technology.

OSE’s rights issue involving existing and new shareholders cements the company as one of the largest of its kind in the UK, with assets worth over £1bn and investments in more than 80 spin-off companies.

Current OSE shareholders include Huawei, the Chinese telecoms equipment maker which the UK government banned in 2020 as a kit supplier for Britain’s 5G mobile networks.

Other shareholders in OSE are Braavos Capital, Lansdowne Partners, Oxford University Endowment Fund, Wellcome Trust and Temasek.

OSE will use the £250 million raised from the rights issue to increase investment in spin-off companies founded at Oxford University that want to commercialize breakthroughs in life sciences, healthcare and so-called technology. deep – encompassing artificial intelligence, robotics, and quantum computing, among other things.

Alexis Dormandy, CEO of OSE, said the company has proven its model of “translating breakthrough science into . . . transformational enterprises” solving global challenges.

“Our companies are making remarkable breakthroughs from cancer, heart failure and infectious diseases, to climate change, food security and quantum computing,” he added.

Founded in 2015, OSE is separate from Oxford University but automatically takes a 10% stake in companies created by its researchers.

OSE’s portfolio companies include Vaccitech, which helped develop AstraZeneca’s Covid-19 vaccine, and ORCA Computing, which supplied the Department of Defense with its first quantum computer.

Dormandy said several OSE-backed companies are at an “inflection point” where advanced technologies are ready for market after years of development.

Among these is First Light Fusion, which announced in June that it had combined atomic nuclei – a revolutionary step in generating clean energy from the reaction that powers the sun.

Chas Bountra, pro-vice chancellor for innovation at Oxford University, named low-cost ventilators, mass testing and vaccine technology during the pandemic as the educational institution’s achievements superior and its consequences.

Referring to the issue of OSE rights, he said: “These additional funds will allow us to create much more [spinouts]but above all allow us to develop these companies quickly with much larger investments. »

Huawei became a shareholder of OSE in 2018 and holds a 0.8% stake.

Oxford University stopped accepting funding from Huawei in 2019, citing concerns over UK partnerships with the Chinese company.

The government decided to phase out the use of the Huawei kit in 5G networks in 2020 after lobbying by the US administration of Donald Trump, which raised national security concerns. Tory MPs also lobbied against Huawei.

OSE confirmed that Huawei participated in the rights issue, adding, “Huawei is a small investor. . . None of OSE’s shareholders obtain confidential information or access regarding its portfolio companies. Investors do not get more information than what is publicly disclosed.

Huawei declined to comment. Oxford University could not immediately be reached for comment.

OSE is one of several UK investment companies set up to fund university spinouts.

The sector received £2.54bn in investment last year, a 69% increase on 2020, according to the Royal Society of Engineering.

The University of Oxford is the UK’s leading higher education company builder, with 193 spin-offs since 2011, according to Beauhurst, a data platform. Oxford now produces an average of 20 companies a year.

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