UK biotech star goes Dutch in £1.3bn deal

Benevolent AI in Europe’s biggest Spac takeover

A BrITISH biotech star headed by a former adviser to David Cameron is planning to go public on the Dutch stock market in one of Europe’s biggest ever healthcare mergers.

Benevolent AI, which is run by Baroness Shields and uses artificial intelligence (AI) to speed up the development of drugs, will join the Euronext Amsterdam stock exchange through a reverse takeover by special purpose acquisition company (Spac), Odyssey.

Spacs are listed on the stock market specifically to raise money and acquire existing companies. They offer an easier route to market for many firms, saving time and money. Their popularity has soared in recent years, with around 571 Spacs listing so far in 2021 compared to just 15 ten years ago.

Odyssey is run by brothers michael and Yoel Zaoui, deal-making investment bankers who operate out of a boutique firm in mayfair, central London.

The merger is expected to raise £332m, which includes Odyssey’s £255m war chest as well as £115m in funds from Benevolent AI backers such as pharma giant Astrazeneca.

Aside from being an investor, Astrazeneca is also working with Benevolent AI to develop treatments for chronic kidney disease. The cash will be used to expand the group’s drug pipeline as well as accelerate research and development of its AI systems.

The float will value the company at around £1.3bn and is expected to take place in the first quarter of 2022.

Founded in 2013, Benevolent AI has over 270 employees and operates a headquarters in London alongside a science campus in Cambridge.

It was previously one of several companies backed by once-feted fund manager neil Woodford.

But its value took a heavy hit when Woodford’s fund collapsed in 2019.

A 2018 fundraising valued the company at £1.5bn, meaning it will fall short of previous highs even if it achieves a £1.3bn market cap upon listing. The firm is headed by Tory peer Joanna Shields (pictured), a former minister for Internet Safety and Security.

Before joining the government, the 59-year-old British-American worked at numerous tech giants, including google and AOL.

The married mother of one also spent three years running Facebook’s Europe, middle East and Africa business, helping grow the region into one of the social media giant’s most lucrative divisions. She has been chief executive of Benevolent AI since may 2018.

‘The combination with Odyssey will allow us to scale our vision and ambition of uniting purposeful technology and cutting-edge science to discover life-changing medicines,’ Shields said. Other business heavyweights including Olivier Brandicourt, the former boss of French pharma giant Sanofi, and Jean raby, ex-chief executive of asset manager natixis, are due to join the company following its float. Despite its imminent Dutch listing, Benevolent AI stressed that it will ‘continue to be a UK-headquartered company’ while growing its teams in both Britain and the US.

However, the loss of the cutting-edge biotech is a blow to the London market, which has been trying to encourage technology firms to list on its exchanges.

Last Friday, new rules came into force to make it easier for companies to list in London as part of a broader push led by the UK government to make it a more attractive financial destination. But these changes seem to have done little to persuade Benevolent AI to debut in the UK.

However, the City has notched up some notable victories recently, making a mockery of gloomy warnings over the impact of Brexit.

Last month, oil giant Shell announced plans to move its headquarters to Britain from the netherlands.

meanwhile, consumer goods giant Unilever has thrown out plans to leave the UK and will maintain a dual listing in London and Amsterdam.