Mercia Asset Regulatory News (MERC)

2 July 2015

Mercia Technologies PLC

£1.5m investment into Midlands-based aluminium forming company Impression Technologies

Mercia Technologies PLC (AIM: MERC, "Mercia" or the "Group"), a Midlands-based investment business that specialises in building, funding and commercialising technology businesses across the UK, has committed to invest £1.5m of a £4.0m investment round into Impression Technologies Ltd, an aluminium forming company based on intellectual property developed at the University of Birmingham and Imperial College London. This investment joins investment from Imperial Innovations plc and will enable the establishment of an innovative press facility.

This additional capital follows a long-standing investment by the Group's third party funds managed by its wholly owned subsidiary, Mercia Fund Management ("MFM"). Following this investment, Mercia will have an 18% direct holding in Impression Technologies, and the Group will control 26% of the business when its stake via its third party funds are included.

Impression Technologies specialises in developing technology for forming complex, high-strength, lightweight components for the transportation industry. The Company's patented Heat treatment, Forming and in die Quenching (HFQ®) technology was developed by Impression Technologies and Imperial College, building on the founding research at the University of Birmingham. The technology allows a wide range of aluminium alloys, including ultra-high strength grades, to be formed in a fast pressing operation without compromising the strength or metallurgical properties of the material. The result is complex but lightweight components, which can be used in the manufacture of cars, trains and airplanes.

The proceeds will be used to fund the acquisition of a press and establishment of a press facility in collaboration with PAB Group ("PAB"), in order to continue development of the technology, and to effectively keep up with volume demand. PAB is currently supplying parts, made with HFQ technology, to the motor industry.

Mark Payton, Chief Executive of Mercia Technologies PLC, said:

"We are proud to continue to support this innovative company, which is located in the Midlands, the heart of the UK manufacturing space for the automotive and aerospace sectors, and based in part on technology from one of our partners, the University of Birmingham.

"The addition of a high speed press facility is crucial in enabling the Company to both demonstrate its patented Hot Form Quench technology and service the high level of commercial interest which has already been expressed by key players in the motor and aerospace industries.

"Impression Technologies provides a demonstration of our regional emphasis and our focus on UK technology sectors that offer investment prospects with high growth potential, including advanced materials, engineering and specialised manufacturing."

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Notes to editors

Mercia Technologies PLC 

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 in.

The Mercia model is one of patiently nurturing businesses through its third party funds under management, and then scaling them with direct investment at the point of commercial delivery. Through this, Mercia has a well seeded portfolio and pipeline of investments - its 'emerging stars'. The Group has a direct investment in 15 operating companies and access to a portfolio of circa 44 businesses through its third party funds, managed by its wholly owned subsidiary Mercia Fund Management.

Mercia's shares started trading on AIM on 18 December 2014, since then Mercia has invested approximately £13m directly across its portfolio of emerging stars which in themselves have attracted a total investment of over £70m alongside investment from the Group to date. In addition to its direct investments, Mercia (via Mercia Fund Management) has invested over £19m to build its portfolio of potential emerging stars.

Impression Technologies Ltd

Impression Technologies provides advanced high-temperature metal forming technologies that enable cost-effective lightweight components to be realised. The technology was jointly developed at the University of Birmingham and Imperial College London by Professor Dean and Professor Lin, respectively. The Company offers Licensing, Training and Support services for forming processes, forming simulation and material test methods. Its portfolio of patented technologies includes the HFQ method, used to form complex components from high-strength sheet aluminium.