Sale of Intechnica Holdings Limited

Mercia Asset Management PLC

("Mercia", the "Group" or the "Company")

Sale of Intechnica Holdings Limited

Mercia Asset Management PLC (AIM: MERC), the proactive, regionally focused specialist asset manager with c.£1.4billion of assets under management, is pleased to announce the profitable sale of Intechnica Holdings Limited ("Intechnica") for a total enterprise value of £14.5million, to US-based Crosslake Technologies LLC ("Crosslake").

Mercia held a 25.5% direct holding in Intechnica at the date of completion and will receive cash proceeds of £3.7million, generating an internal rate of return ("IRR") of 27% and a 1.7x multiple on its current holding value. 

Based in Manchester, Intechnica is a leading provider of specialised IT and technology consulting services for private equity firms. Founded by Jeremy Gidlow and Andy Still, Mercia first invested in December 2013 through one of its managed funds and it subsequently became a direct investment in April 2017.

In addition to the direct investment return, three of Mercia's third-party funds collectively held a further 27.9% providing a blended IRR on investment returns of 32.0% (2.6x on investment cost). Mercia has proactively supported Intechnica, building out the Board and then initiating the spin-out of a cyber security product developed by the founders - Netacea Limited ("Netacea"). Will Clark, Mercia's Managing Director of Regional Venture, was a board director at exit and remains on the board of Netacea.  

Dr Mark Payton, CEO of Mercia Asset Management PLC, said: "Intechnica is a great Manchester-based business that, as with all our direct investments, has been supported by Mercia's regionally managed funds. This full-cash exit delivers an excellent result for Mercia and allows Intechnica's founders to focus on the continued growth of Netacea, an increasingly respected global brand in the cyber threat detection market.

"This is another direct investment exit above holding value, which continues to support our valuation methodologies."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon publication of this announcement, this inside information is now considered to be in the public domain.

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About Mercia Asset Management PLC

Mercia is a proactive, specialist asset manager focused on supporting regional SMEs to achieve their growth aspirations. Mercia provides capital across its four asset classes of venture, private equity, debt and proprietary capital: the Group's 'Complete Connected Capital'. The Group initially nurtures businesses via its third-party funds under management, then over time Mercia can provide further funding to the most promising companies, by deploying direct investment follow-on capital from its own balance sheet.

The Group has a strong UK footprint through its regional offices, university partnerships and extensive personal networks, providing it with access to high-quality deal flow.

Mercia Asset Management PLC is quoted on AIM with the EPIC "MERC".