LONDON, UK: Mercia Asset Management announced the profitable sale of nDreams Limited to Aonic AB for an enterprise value of £90.3million ($110million).

Mercia held a 33.2% direct stake in nDreams, resulting in total consideration of £30.2million, split  £26.4million in cash proceeds and £3.8million re-invested into Aonic itself.

This exit results in a 2.7x return on invested capital and an 18.4% IRR. The exit price represents a £4.4million (17.5%) increase on Mercia’s carrying value for nDreams as at 31 March 2023.

nDreams is a leading virtual reality (“VR”) studio that specialises in developing and publishing VR games. nDreams is headquartered in Farnborough and was founded by Patrick O’Luanaigh in 2006.

Mercia was one of the first investors to anticipate the growth of VR, prior to Facebook buying Oculus. Mercia’s initial investment of £0.3million in nDreams was made in March 2014 through its managed funds, with the Group first investing from its own balance sheet in December 2014.

Aonic is a diversified video gaming investment group, with a strong position in the VR and augmented reality (“AR”) industry, and made an initial £20.0million ($35million) investment into nDreams in March 2022.

Dr Mark Payton, CEO of Mercia Asset Management PLC, said: “This trade sale represents another profitable outcome for Mercia, realising a significant return which is above our current holding value, predominantly in cash. 

This latest successful exit further adds to our strong debt free cash position, which now stands at c.£60million. We look forward to announcing Mercia’s Interim Results on 28 November 2023.”

Julian Viggars, CIO of Mercia Asset Management PLC and nDreams’ board member, commented: “When we first invested in nDreams we had a high conviction in the potential of VR gaming, and this realisation is a strong validation of that thesis.

We have proactively supported nDreams since 2014 and are pleased that we will continue to benefit from their continuing growth as part of Aonic, through our partial reinvestment.

We look forward to nDreams continuing on its exciting VR and AR journey within a larger gaming group and congratulate Patrick O’Luanaigh and his nDreams team on all that they have achieved thus far.”

Mercia is a proactive, specialist asset manager focused on supporting regional SMEs to achieve their growth aspirations. Mercia provides capital across its four asset classes of venture, private equity, debt and proprietary capital: the Group’s ‘Complete Connected Capital’. The Group initially nurtures businesses via its third-party funds under management, then over time Mercia can provide further funding to the most promising companies, by deploying direct investment follow-on capital from its own balance sheet.

The Group has a strong UK footprint through its regional offices, university partnerships and extensive personal networks, providing it with access to high-quality deal flow.

Mercia Asset Management PLC is quoted on AIM with the EPIC “MERC”.

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