Portfolio co Ceres finalises deal with Weichai

IP Group plc - Portfolio company Ceres Power finalises strategic collaboration with Weichai; further £28m investment

IP Group plc (LSE: IPO) ("IP Group" or "the Group"), the developer of intellectual property-based businesses, is pleased to note that portfolio company Ceres Power Holdings plc ("Ceres", "Ceres Power" or "the Company") and Weichai Power ("Weichai"), one of the leading automobile and equipment manufacturing companies in China, have agreed a long-term strategic collaboration.

The agreement, which triggers a further £28m equity injection into Ceres Power, includes a Joint Venture Agreement with the commitment to create a fuel cell manufacturing JV in China, a License Agreement to transfer key technology to the JV and a new £9 million joint development agreement.

Prior to the new equity investment by Weichai, IP Group currently holds a direct undiluted beneficial stake of 21.3% in Ceres, developer of the SteelCell®, a world-leading, low cost Solid Oxide Fuel Cell technology.

Dr Robert Trezona, Head of Cleantech at IP Group, said: "Ceres Power continues to make excellent commercial progress, having signed agreements with Weichai and Bosch this year. The Company is also well funded having completed a significantly oversubscribed £20m fundraising in July as well as having agreed a combined £57m of new investment from Weichai and Bosch. Since IP Group's investment in Ceres in 2012, the Company has gone from strength to strength and is a great example of how we've helped to create a world-leading company based on scientific research carried out in the UK."

The highlights of Ceres' announcement are:

-    A new Joint Development Agreement (JDA) worth £9m to Ceres for the continued development of a first range extender product for electric buses in China.

-    A Joint Venture Agreement for Ceres and Weichai to invest in a major new fuel cell manufacturing facility in Shandong, China, following successful trials.

-    A License Agreement which will result in significant staged Technology Transfer payments of up to £30m, and ongoing future royalties to Ceres.

-    Weichai will invest a further £28m in Ceres through the exercise of its warrant at 164.5p per share to increase its stake in Ceres from just under 10% to 20%. This brings its total equity investment in Ceres to £48m.

Ceres has completed a number of collaborations this year including a strategic collaboration with Robert Bosch GmbH as well as a £9m strategic equity investment by Bosch into Ceres in August. Prior to that, Ceres signed a new partnership with Nissan to further develop fuel cell technology for EV applications which saw Ceres and The Welding Institute awarded a total of £8m UK Government funding through the Advanced Propulsion Centre for the project.

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About IP Group

IP Group is a leading intellectual property commercialisation company which focuses on evolving great ideas, mainly from its partner universities, into world-changing businesses. The Group has pioneered a unique approach to developing these ideas and the resulting businesses by providing access to business building expertise, capital (through its 100%-owned FCA-authorised subsidiaries IP Capital and Parkwalk Advisors), networks, recruitment and business support. IP Group has a strong track record of success and its portfolio comprises holdings in early-stage to mature businesses across life sciences and technology. IP Group is listed on the Main Market of the London Stock Exchange under the code IPO.

Group holdings in portfolio companies reflect the undiluted beneficial equity interest excluding debt, unless otherwise explicitly stated.

For more information, please visit our website at www.ipgroupplc.com.

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