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IP Group PLC said on Tuesday that its stake in its portfolio company First Light Fusion Ltd is set to double after the company achieved fusion.
The London-based intellectual property commercialisation company noted First Light's achievement of fusion with a projectile approach; the first of its kind, which has been independently validated by the UK Atomic Energy Authority.
‘Instead of using complex and expensive lasers or magnets to generate or maintain the conditions for fusion, First Light's approach compresses the fuel inside a target using a projectile travelling at tremendous speed,’ First Light explained.
First Light, a University of Oxford spin-out company, said it believes this approach is faster, simpler and cheaper than other routes to commercial fusion power. It achieved fusion with a spend of less than £45 million.
IP Group said its 27% holding in First Light was valued at £57.3 million at December 31, and it now expects the value to double by around £57 million, or around 5 pence per share.
It also noted recent comparatives and third party valuation work which suggest First Light's valuation could double or quadruple in the next funding round.
Shares in IP Group were up 4.4% to 93.71 pence each in London on Tuesday morning, the top FTSE 250 gainer.
‘Following the success of Oxford Nanopore, Ceres Power and others, this is another example of IP Group having helped establish a business with the potential to have enormous impact and supporting it over many years to a significant inflexion point. We continue to have strong conviction in the company and the potential its technology offers,’ said IP Chief Executive Officer Greg Smith.
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