First Derivatives plc (LON:FDP) today announces that it has agreed to sell part of its investment in Quantile Technologies to growth equity firm Spectrum Equity.
Under the terms of the transaction, First Derivatives will dispose of the majority of its holding in Quantile for cash consideration of £11 million, representing a total gain of £10 million on the initial cost of the investment (£7m gain on the current carrying value).
Following this transaction, First Derivatives will retain a minority stake in Quantile.
The investment occurred as part of FD’s strategy of assisting companies that were adopting KX in new and innovative ways. Quantile utilises KX as the technology that underpins its highly successful advanced compression and risk rebalancing services and remains a valuable customer of the Group.
The investment in Quantile represented FD’s largest investment of this type, accounting for £10 million of a total of £16 million of other financial assets on the Group’s consolidated balance sheet as at 28 February 2020.
In the year to December 2019, Quantile reported net profit of £0.7m, although its performance was not consolidated as FD’s holding was below 20%.
The consideration has been received and the proceeds will be used for general working capital purposes, First Derivatives explains.