LONDON (ShareCast) - (Sharecast News) - Syncona announced a strategic pivot toward an orderly realisation of its portfolio assets on Thursday, as the life sciences investor looked to balance returning cash to shareholders with efforts to maximise long-term value from its maturing holdings.
The London-listed company's move followed a comprehensive review by its board, which engaged with shareholders and advisers amid continued weakness in biotech valuations and Syncona's persistent share price discount to NAV.

It reported a net asset value of £1.05bn, or 170.9p per share, as of 31 March, down from £1.24bn the prior year.

The portfolio delivered a NAV total return of -9.5%, driven by a sharp decline in the share price of listed holding Autolus Therapeutics and write-downs at Resolution Therapeutics and Biomodal.

"Syncona's share price has continued to be impacted by the significant headwinds in the markets it operates," said chair Melanie Gee.

"Against this backdrop, the board has undertaken a comprehensive review of strategic options to maximise value for shareholders.

"We remain focused on exploring options to provide shareholders with accelerated cash returns and are seeking to offer certain Syncona shareholders the opportunity to roll their interest into a new private fund."

Under the proposed new investment objective and policy - subject to FCA and shareholder approval - Syncona said it would aim to realise its assets in an orderly fashion, with proceeds returned to shareholders on an ongoing basis.

At the same time, the company said it intended to maintain financial support for portfolio companies expected to deliver key value inflection points, including merger and acquisition or public market liquidity events.

10 such milestones were expected over the next three years, with two targeted before the end of calendar year 2025.

"Performance during the year was impacted by adverse market conditions," said Chris Hollowood, CEO of Syncona Investment Management (SIML).

"From an operational and clinical perspective, the portfolio continues to mature and make strong progress.

"We are confident in the long-term opportunity to continue creating and building companies leveraging world-class research."

Despite the challenging backdrop, SIML oversaw financings that raised a total of £310.6m across seven companies in the year, including £175.5m from external investors.

Syncona itself deployed £135.3m - below guidance - as it took a disciplined approach to capital allocation.

Clinical-stage and commercial companies now comprised nearly 80% of the portfolio by value.

In parallel with the strategic shift, Syncona said it was also exploring a potential new private investment vehicle for shareholders who wish to maintain exposure to early-stage life science assets.

Discussions were underway with institutional investors and research partners, with SIML potentially managing both the new fund and the existing portfolio through a restructured arrangement.

If approved, the changes would also see Syncona suspend its 2032 targets, including its ambition to grow assets to £5bn and create three new companies annually.

The board was expected to shrink in size to reflect the company's new trajectory.

Syncona said any general meeting to approve the revised strategy would be held once there was greater clarity on whether near-term cash returns could be accelerated, potentially through secondary sales of select holdings at modest premiums to Syncona's current share price.

At 1249 BST, shares in Syncona were up 5.62% at 94p.

Reporting by Josh White for Sharecast.com.

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