Irish investors in the money after sale of US nanotech Labcyte

Irish investors, including State body Enterprise Ireland and Trinity College Dublin, have made a healthy return on their stake in Labcyte, a Californian company that has just been acquired for an undisclosed sum.

The Irish shareholders, which also include Seroba Lifesciences, 4th Level Ventures and the Investec-managed Guinness Ireland Ulster Bank Equity Fund, all acquired their stake in Lacbyte via an earlier investment in Allegro Technologies, a nanotechnology research company that traded as Deerac Fluidics.

Labcyte acquired the Trinity College spinout for an undisclosed sum in 2008 with Deerac’s Dublin office continuing to be maintained as a European sales hub for the San Jose-headquartered company.

The Irish investors, which also include former Deerac executives, held just under 9 per cent of Labcyte, that has just been acquired by Beckman Coulter, a division of Fortune 500 company Danaher Corporation.

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While no figures have been disclosed, industry sources estimate the acquisition is likely to have been valued north of $300 million (€262.8 million).

On that basis, the Irish VC funds that backed Deerac at an early stage would have made a return of about five times their original investment.

Company documents show Enterprise Ireland invested at least €550,000 in the company in the early 2000s. The Guinness Ireland Ulster Bank Equity Fund put in about €1.5 million, while Seroba and 4th Level Ventures each invested at least €500,000.

Physics department

Founded in 2000, Deerac was spun out of the physics department at TCD and was based on the research of co-founders Prof Igor Shvets and Dr Jürgen Osing, who developed technologies that are used in instruments which dispense minute droplets of liquid, down to the 50 nanolitre range.

At the time of the company’s acquisition, the demand for low volume liquid handling devices was increasing. It remains strong due to the need for tools that facilitate miniaturisation in pharmaceutical research, biotechnology and diagnostics.

Dublin-headquartered Labcyte Europe Limited incurred a €273,927 net loss during the year ending June 2017, according to its most recently filed results, and had net liabilities of €3.96 million.

Founded in 2000 and formerly known as Picoliter, Labcyte has developed advanced liquid handling solutions for life science research and clinical applications. It employs more than 200 people globally and has approximately 60 US patents.

"Acoustic liquid handling is quickly becoming the backbone for high-throughput, automated workflows, and we look forward to accelerating growth and innovation as part of the Beckman Coulter Life Sciences team," said Lacbyte co-founder and chief technology officer Richard Ellson.