Agreement for sale of assets

Schroder UK Public Private Trust plc (the "Company")

Agreement for sale of assets

The Company (LSE: SUPP) is pleased to announce that it has signed a sale and purchase agreement for the sale of a basket of seven assets (the "Sale Portfolio") to Rosetta Capital VI, LP (the "Buyer"), an investment fund managed by the UK-based life science venture capital firm Rosetta Capital Limited, for a total acquisition price of £49.0 million (the "Transaction"). The Sale Portfolio consists of the Company's entire holdings in Carrick Therapeutics, Mission Therapeutics, PsiOxus Therapeutics and Mereo BioPharma and partial holdings in Inivata, Immunocore and ReNeuron. The agreed acquisition price represents a discount of 22 per cent to the aggregate valuation for those holdings reflected in the Q3 2020 Net Asset Value ("NAV") as at 30 September 2020 (as published on 3 December 2020) or a discount of 19% per cent adjusted for relevant foreign exchange rate changes as of 25 January 2021.

The Buyer has also agreed to pay approximately £2.9 million to the Company representing the value of certain follow-on investments made by the Company with respect to holdings contained in the Sale Portfolio during January 2021. In total, the Company expects to receive initial proceeds from the Transaction of approximately £51.9 million.

Furthermore, given the recent news of Immunocore filing for an initial public offering ("IPO"), the Company has agreed with the Buyer an earn-out under which the Company might receive an additional contingent payment of up to £5.0 million subject to the Immunocore stake acquired by the Buyer exceeding certain value thresholds at the Buyer's future exit of the investment. The Company had previously agreed to a lock-up period under which it would not sell its entire holding for a period of 6 months from the date of the IPO. The Buyer has agreed to be bound by the restrictions of a lock-up agreement on the same terms as the Company. The Company will remain subject to the lock-up for the proportion of the holding it is retaining.

In addition, the Company and the Buyer have agreed to a potential adjustment to the acquisition price in the event of significant changes in value of the listed portfolio companies Mereo BioPharma and ReNeuron on an aggregated basis by the date of completion of the Transaction. The Company does not currently expect the potential acquisition price adjustment, if any, to be significant in the context of the overall transaction.

The closing of the Transaction is subject to customary closing conditions. The Company expects the completion to occur in late February or March 2021.

The valuation impact of the Transaction is expected to be reflected in the NAV of the Company as at 31 December 2020, which is expected to be announced in April 2021.

A significant proportion of the expected proceeds will be used to pay down a meaningful portion of the Company's outstanding debt under its credit facility whereby the current term loan will convert to a revolving credit facility. In addition, the Company intends to use the additional liquidity to support some of its portfolio companies with follow-on capital and further optimise the portfolio composition by selectively investing into new opportunities

Tim Creed and Ben Wicks, Portfolio Managers of the Company, jointly commented: "After the announcement of the acquisition of Kymab by Sanofi and the extension of the Company's credit facility by two years, this is the third very positive announcement for the Company so far in 2021.  When we assumed the management of the Company's investment portfolio in December 2019, we communicated that our initial focus in the process of repositioning the portfolio would be to reduce the outstanding debt to a sustainable level and put the Company back into a position to support its portfolio companies with follow-on capital and selectively make new investments. The basket transaction being announced today is a further important milestone for the Company and delivers against that communicated goal. Together with the divestiture of Kymab, the Company expects to receive total proceeds of more than £115 million by the end of the first half of 2021. Also, we are delighted to welcome Rosetta Capital as co-shareholders in ReNeuron, Immunocore and Inivata and we welcome their expertise and experience. We are looking forward to continuing to work with the management teams of the Company's holdings in delivering sustainable value and positive long-term shareholder returns."

Susan Searle, Chair of the Board of the Company, commented: "I am extremely pleased with the progress that Schroders have made since taking over the management of the portfolio. The three announcements made in 2021; the extension of our debt facility, a significant portfolio company cash exit and a portfolio sale put the Company in a solid position from which to grow in 2021. These events reflect the hard work of the team throughout 2020 and I look forward to seeing the team build on this encouraging positive progress in repositioning the Company's portfolio."

Enquiries:

Schroder Investment Management Limited

LEI: 2138008X94M7OVE73I77

This announcement contains Inside Information as defined under the Market Abuse Regulation (EU) No. 596/2014.