IP Group PLC: Railpen take-private approach rejected

Research evidence excerpt

IP Group PLC: Railpen take-private approach rejected

Deutsche Bank Group

Deutsche Numis Research

Rating Company Date

Buy IP Group PLC 22 June 2026

Europe Reuters Bloomberg Rating Buy

United Kingdom IPO.L IPO LN Price target (GBX) 110.00 Price at 19 Jun 26 64.70

52-week range 70.60 – 46.75

Diversified Financials

Asset Managers Valuation & Risks

Railpen take-private approach rejected

Kane Slutzkin, CFA

Summary Research Analyst

+44-20-754-54624 Railpen, IP Group’s largest shareholder with an 18.4% stake, has made a non-

binding take-private approach, which the Board has rejected. The latest proposal

values IP Group at ~69.7p/sh plus up to 5p/sh through a contingent value right

(CVR), comprising 59p cash and a variable ONT component worth ~10.7p/sh

based on ONT's closing share price of 116.5p. While shares have re-rated c.40%

since Railpen’s reference date (25 March), the proposal still values IP Group at a

37% discount to the last reported NAV of 110p/sh. Moreover, the proposal is not

a clean all-cash offer, with shareholders exposed to a variable ONT component

and contingent Istesso payment. It also appears to attribute limited value to the

substantial optionality in the portfolio, most notably the Pfizer obesity royalty

interest. Against this backdrop, the Board’s rejection is unsurprising to us. PUSU

deadline: 20 July.

Details of the offer

The most recent proposal implied a total value of ~69.7p/share plus up to

5p/share through a CVR, comprising:

• 59p cash per share.

• The value of IP Group's ONT stake (~10.7p/share), based on an ONT

share price of 116.5p and therefore variable rather than fixed cash

consideration.

• A contingent value right (CVR) of up to 5p/ share linked to a potential

disposal of Istesso within 12 months, with additional payments triggered