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Oxford Nanopore Raises $64 Million for Infrastructure

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Oct. 9 (Bloomberg) -- Oxford Nanopore Technologies Ltd., the U.K. company working to develop a portable gene-sequencer, raised 40 million pounds ($64 million) from new and existing investors in the U.S. and Europe.

The money will be used to build the company’s sales and manufacturing capacity, research and development and for other purposes including protecting intellectual property, the closely held Oxford, England-based company said today in a statement.

The new shareholders include Odey Asset Management LLP, the London-based hedge fund founded by Crispin Odey, Oxford Nanopore said. The company’s existing shareholders previously invested 105 million pounds and include IP Group Plc, Illumina Inc., Invesco Perpetual and Lansdowne Partners. Oxford Nanopore also has individual shareholders, including company managers, and employees have stock options.

The company has started early-access programs for its MinION handheld sequencer and it will probably make the device “more widely available within the next two quarters,” Numis Securities analyst Charles Weston wrote today in a note to clients, citing Oxford Nanopore and Chief Executive Officer Gordon Sanghera. Weston expects the company to unveil the product at the American Society of Human Genetics meeting in Boston Oct. 22-26.

Technical Delays

Sanghera said early last year the company expected to begin selling its products by the end of 2012. The company has since faced technical delays as it has had to redesign a sensor that wasn’t performing satisfactorily.

Oxford Nanopore is developing handheld and desktop devices that use a novel technique known as strand sequencing, in which an entire string of DNA is guided by an enzyme and passes intact through a tiny hole in a cell membrane one-billionth of a meter wide.

The company was spun out of Oxford University in 2005 and its technology was initially based on research by Hagan Bayley, a professor of chemical biology at the university. Weston estimated the company’s value at $1.5 billion in a Feb. 20 note to clients.

IP Group and its IP Venture Fund committed 4.8 million pounds to the fundraising, according to a statement today from London-based IP Group. It now owns 19.6 percent of Oxford Nanopore, which it values at 104.3 million pounds and which Weston said implies a value for Oxford Nanopore of $850 million after the fundraising.

Shares of IP Group rose 0.2 percent to 137 pence at 12:35 p.m. in London.

To contact the reporter on this story: Andrea Gerlin in London at agerlin@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net