Temasek-backed Covid-19 test provider Oxford Nanopore soars in London trading debut

[LONDON] DNA-sequencing company Oxford Nanopore Technologies rose as much as 32 per cent as it started trading in London, buoyed by a pandemic boost and strong demand for fast-growing tech stocks in the UK.

The stock climbed 28 per cent to 545.50 pence at 8.12am from the initial public offering price of 425 pence. The IPO valued Oxford Nanopore at £3.4 billion (S$6.22 billion).

Oxford Nanopore raised £350 million selling new stock, while its backers offloaded existing shares worth £174 million, according to a statement Thursday.

The shares were priced in the the top half of the range at which they were marketed. The University of Oxford spinoff's holders sold more shares in the IPO than planned due to high demand.

The Oracle-backed company provides Covid-19 test kits to Britain's National Health Service, and its sequencing technology has been used by researchers to characterise the genome of the Sars-CoV-2 virus to identify and track variants.

Oxford Nanopore has added about US$1 billion to its market value since its last funding round in May, placing it among the UK's most valuable startups. The IPO is an important win for London's ambitions to boost its profile as a hub for innovative businesses.

The company has also given Gordon Sanghera, its founder and chief executive officer, a special class of shares with extra power to block an unwanted takeover. Though panned by some investors for diluting voting rights, there are plans to allow multiple classes of shares on the London Stock Exchange's top-tier premium market.

For now, Oxford Nanopore is relegated to the bourse's standard segment, which means it is ineligible for certain major benchmarks like the FTSE Russell indices.

Bank of America, Citigroup and JPMorgan Chase & Co are global coordinators of the offering. Barclays Bank, Berenberg, Guggenheim Securities, Numis Corp and RBC Capital Markets are joint bookrunners.

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