Mercia Asset Regulatory News (MERC)

22 October 2015

Mercia Technologies PLC

£1.2m of £1.5m investment in Smart Antenna Technologies

Mercia Technologies PLC (AIM: Merc, "Mercia"), a Midlands-based investment group building, funding and commercialising technology businesses across the UK, has completed a £1.2m follow on investment as part of a total funding syndicate of £1.5m into Smart Antenna Technologies ("SAT"), a spinout from the University of Birmingham. SAT has developed a global antenna system for devices with multiple wireless data connections, including smart phones, tablets and laptops.

Mercia's investment will be used to continue SAT's technology development alongside its ongoing discussions with several major mobile and laptop partners.

Based upon patented technology developed by founder Sampson Hu, SAT provides an efficient and low cost antenna solution to the mobile and portable device market. SAT's highly scalable technology has the potential to lower costs, reduce size, increase frequency range and offer much needed performance gains over existing designs and technologies.

The Executive Chairman of SAT is Colin Tucker, the former Orange CTO and COO for European business, and the founding CEO of 3, the first 3G operator in the UK.

Currently, mobile handsets typically use around six different antennas, but such devices are unable to achieve the desired antenna performance in a size that fits the cellular handset package at acceptable volume production costs. Mobile device manufacturers are now seeking an effective antenna solution for implementing the next generation of mobile communication technologies such as LTE (Long Term Evolution), or 4G.

The global antenna market was estimated to be worth $14.2bn in 2013 and $15.1bn in 2014. It is predicted to grow to $19.9bn by 2019, according to a report published in December 2014 by BCC Research. One billion devices are produced annually, with the portable device market forecast to be producing 2.96 billion units per year by 2017.

SAT is an "emerging star" from Mercia's wholly-owned subsidiary of third party funds, Mercia Fund Management.

Mark Payton, CEO, Mercia Technologies PLC, said:

"We are delighted to continue to support Smart Antenna Technologies, which has gained a great deal of market interest since Mercia Fund Management's initial investment, when it spun out of the University of Birmingham. SAT's technology has the potential to be a major component in the development of next generation mobile devices.

"SAT is a further example of our Complete Capital Solution, whereby we selectively invest to scale portfolio companies emanating from our third party managed funds.

"We look forward to supporting SAT further as it continues to build market opportunities and develops its ongoing discussions with a range of potential commercial partners."

Sampson Hu, founder of Smart Antenna Technologies, said:

"Smart phones are becoming ever more powerful, but as functionality increases more antennas are required. Our patented technology provides one powerful, multi-functional antenna system, with the potential to reduce production costs by up to 50% whilst potentially increasing the battery life of the device.

"Mercia's support has been invaluable since the business was launched in 2013, and we look forward to continuing a rewarding and productive relationship with the Mercia team, as we enter the next phase of our growth story."

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Note to editors

Mercia creates, funds and develops technology businesses nationally with an emphasis in the Midlands, the North and Scotland. It brings technology transfer, company formation, incubation, commercialisation and investment to technology ventures. Approximately 50% of its investments derive from university spinouts. Mercia invests across key technology sectors in which it has deep sector expertise.

The Mercia model is one of patiently nurturing businesses through its tax efficient third party funds under management, and then scaling them with direct investment at the point of commercial traction. Through this, Mercia has a well seeded portfolio and pipeline of investments - its 'emerging stars'.

Mercia's shares started trading on AIM on 18 December 2014 and since then up until 31 July 2015, Mercia has invested almost £15m directly across its portfolio of emerging stars, which in themselves have attracted total investment of over £70m alongside investment from the Group. In addition to its direct investments, Mercia (via Mercia Fund Management) has invested over £20m to build its portfolio of potential emerging stars.