IP Group shares were up 1.7% to 91.3p in early morning trading on Tuesday following the firm’s announcement that its portfolio company First Light Fusion had achieved world first fusion results with ‘projectile fusion.’
According to the IP Group, the First Light Fusion project might open up the potential for cheaper and faster fusion energy production.
The project was independently validated by the UK Atomic Energy Authority (UKAEA), and harnessed the bespoke target technology produced by First Light.
The portfolio company reportedly spent less than £45 million on the project and said it holds a faster rate of performance improvement than any other fusion scheme in history.
First Light Fusion is also working towards a pilot plant which would produce 150 mega-watts of electricity and cost less than $1 billion in the 2030s.
The firm is working with UBS Investment Bank to explore options for the upcoming stages of its commercial and scientific development.
The IP Group added that it was optimistic that this project would see First Light Fusion double in value, and third-party valuation suggested that a doubling to quadrupling could be hit in the coming funding round.
The company currently estimates that the portfolio company has a carrying value which could generate a net fair value gain of £57 million, which represents approximately 5p per share.
The IP Group held an undiluted beneficial holding on 27.4% in First Light Fusion of 27.4% in December last year, amounting to £57.3 million.
“Following the success of Oxford Nanopore, Ceres Power and others, this is another example of IP Group having helped establish a business with the potential to have enormous impact and supporting it over many years to a significant inflexion point,” said IP Group CEO Greg Smith.
“In this case, we helped found First Light in 2011 with the belief that its differentiated technology had the potential to provide a much cheaper route to fusion energy.”
“Hitting the fusion milestone is a hugely important step on that journey and we’re delighted for the team at First Light and are extremely proud of their achievements.”
“We continue to have strong conviction in the Company and the potential its technology offers.”
