IP Group rejects Railpen bid to make it a venture capital manager for pension schemes

Railways Pension Trustee Company (Railpen), the industry-wide pension scheme for the UK rail sector managing over £34 billion in assets on behalf of more than 350,000 members, formally announced on June 23, 2026, that IP Group PLC has rejected its proposed takeover offer valued at £615.8 million. The proposal represented a significant strategic overture from the UK's largest rail pension fund toward the London-based venture capital and science and technology investor.

The rejected bid valued IP Group at 69.7p per share, comprising 59p in cash plus a contingent value right mechanism worth up to an additional 5p per share. A critical component of the offer included a structured mechanism allowing shareholders to realize the value of IP Group's pro rata shareholding in Oxford Nanopore Technologies PLC, which Railpen valued at approximately 10.7p per IP Group share based on ONT's contemporaneous closing price of 116.5p. Railpen characterized the offer as providing an "immediate cash return" at a 48% premium to IP Group's share price as of March 25, 2026.

Railpen, currently holding 18.4% of IP Group's issued share capital accumulated since becoming a shareholder in 2019, had spent several months exploring the proposal before formally approaching IP Group in late 2025. The pension fund outlined an ambitious vision to restructure IP Group into a scaled, world-class third-party venture and scale-up capital manager backed by a consortium of pension funds. According to Railpen's statement, such a consortium would be "uniquely positioned to unlock further long-term capital to support the future growth of IP Group and its portfolio companies" while supporting the expansion of UK-led scientific innovation. Notably, Railpen committed to reinvesting its entire current shareholding in any restructured entity, signaling confidence in the proposed strategic direction.

Railpen's rationale centered on IP Group's operational challenges as a publicly listed company, citing persistent trading discounts to published net asset value and what the pension fund characterized as a "challenging experience" in the public markets. However, IP Group's board determined the offer undervalued the company, resulting in the outright rejection. Under UK takeover rules, Railpen maintains until 5 p.m. on July 20, 2026, to announce either a firm intention to proceed with a bid or to formally withdraw from the process.