Oxford Instruments shares sink as it sells quantum business to US firm
Oxford Instruments has become the latest British business to hand its quantum technology to the US after reaching a deal with California-based Quantum Design.
The FTSE 250 business has offloaded its quantum arm, called NanoScience, to the US firm in a £60m deal, a move it said would help improve focus on profitability amid a concentration on core markets.
The move makes NanoScience the second quantum group to be sold to the US in as many days after quantum computing business Oxford Ionics on Monday signed a $1.1bn deal to be taken over by New York-listed rival IonQ.
NanoScience, which had already been profitable, was turning over revenues of £59m, meaning the company was sold at barely more than a 1x revenue multiple.
Oxford Instruments said the proceeds from the sale would be used to support a £50m share buyback, which would commence shortly.
Oxford Instruments shares fell more than 3 per cent in early London trade. The stock is down by more than a quarter over the past year.
CEO Richard Tyson said: “The sale of our NanoScience quantum business is in line with our strategy to focus and invest in the best areas of opportunity to grow the group and create value for shareholders, and supports progress towards our medium-term margin targets.
“It is also consistent with our focus on our three core markets: materials analysis, semiconductor, and healthcare and life science.
“Quantum Design’s desire to lead the business through the next stage of its development and investment journey is a testament to NanoScience’s talented team and excellent technology.”
Results delay
The disposal comes as Oxford Instruments reported a delay to the publication of its results, which were also due on Tuesday, which it said was because the firm’s accountants, BDO, requested further time to complete its audit procedures.
In its previous trading update in April, the firm said revenue growth in the second half of its financial year rose 9 per cent, while its adjusted operating profit was expected to be up around 13 per cent on a constant currency basis.
Tyson said the firm was “seeing the benefits of the actions we have taken to drive operational excellence, improve commercial execution, and bring a greater focus on our costs.”