Are the fortunes of early-stage technology investor Allied Minds (ALM) starting to turn? The group, whose shares are down 88 per cent since the start of 2017, provided its latest cause for optimism on Tuesday 24 September, after unveiling plans to sell its entire stake in satellite technology firm HawkEye 360 for $65.6m (£52.8m) in cash.
The disposal, to privately owned media firm Advance, is a major liquidation event for the group. Since founding HawkEye in 2015, Allied Minds has seen the radio frequency data analytics specialist grow into its largest single holding, recently helping it secure backing from aircraft manufacturing giant Airbus and Californian data company Esri.
Those investments arrived in a $70m Series B financing round in August, to which Allied Minds contributed a further $5m and which valued HawkEye at $200m. As such, this week’s sale was made at a 15 per cent discount, which might explain the muted investor reaction to the promise of a $32.8m return, equivalent to 11p a share.
However, there can be few grumbles about the exit, which represents a 5.6 times return on invested capital, or an internal rate of return of 96 per cent over four years. Other realisations have been scant. During the past three years, divestments have been limited to the sale of the trade and assets of IT security firm Percipient Networks for $4m in 2018.
News of the capital return should bring some relief to fund manager Neil Woodford, whose funds – including the currently shuttered Woodford Equity Income – own a 21.6 per cent stake in Allied Minds. Invesco, where Mr Woodford was a fund manager before striking out on his own in 2014, owns 23 per cent of the group.
Half-year results for the group had not yet been released when this article went to press.
