Allied Minds is an IP commercialisation company with a concentrated investment portfolio focused on early-stage companies within life sciences and technology. Its portfolio companies are spin-outs from US federal government laboratories and universities.
The Federated Wireless funding round comes hot on the heels of the Hawkeye360 fund-raise in August 2019. We estimate that the Federated Wireless round provides a further NAV uplift of $22m, equating to 4p per share (net of the $10m cash invested). Allied Minds has now delivered additional validation for two of its three principal portfolio companies, with 2019 funding rounds closed with strategic investors (in line with its June AGM statement), each offering material NAV uplifts. We calculate the fully diluted NAV of these two portfolio companies alone comes to 53p. At today’s price, considering our estimate of adjusted net cash of approximately 10p, Spin Memory, BridgeSat and the remainder of the portfolio are in the price for free.
Investor sentiment towards the IPC sector in general has remained negative in H119, with stocks continuing to trade at a meaningful discount to NAV. This has only been exacerbated by the recent fallout from Woodford, a major investor in the patient capital sector. In H219, we expect investors to continue to differentiate between stocks that offer the potential for meaningful exits in a realistic timeframe and those that do not.