The First Graphene IPO – Applied Graphene Materials

In previous articles, we have discussed the investment potential of graphene, and examined the merits of companies such as Graftech and CVD Equipment. One UK based company that is looking to float on the London Stock Exchange this month as the first graphene IPO is Applied Graphene Materials.

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Previously known as Durham Graphene Science, this company was a spinout from the University of Durham in 2010 and recently announced a name change to Applied Graphene Materials (AGM). Last month the Company announced an intent to float on the London Stock Exchange in November 2013. In February of 2012, the Company received seed funding from IP Group, a firm specializing in intellectual property-based businesses and university spinouts for the amount of $1.9 million. IP Group now has a 22% stake in AGM.

Value Proposition

In an article published by the Financial Times last month, Applied Graphene Materials stated that “graphene’s wider adoption had been hampered by the inability to produce it cost-efficiently and at scale.” The company cited forecasts for total graphene demand to increase tenfold from 40 tonnes a year to 400 tonnes by 2017.  AGM uses a unique and scalable ‘bottom-up’ approach to prepare graphene that is protected by a patent application. While AGM’s current production capacity is only one ton per year, they plan to increase their production capacity to eight tons a year over the next 18 months. In August of this year, AGM was awarded a grant along with Proctor and Gamble and Dyson Appliances to research and develop graphene nanocomposites.

The fact that Applied Graphene Materials plans to float on the London Stock Exchange this month is exciting since so few investment options exist for investors who want exposure to the graphene story. Given that, the company seems to only have one patent application protecting their production process and not much information has been made available yet regarding any sort of financials, partnerships, etc. When the company actually floats on the London Stock Exchange, such information should be made available so that investors can truly assess the prospects of AGM going forward.

U.S. based investors who want to invest in Applied Graphene Materials (LON:AGM) will need to sign up for an Interactive Brokers trading account.

Update November 20, 2013: The AGM IPO has been more than two times subscribed showing a great deal of interest by investors. The shares are set to float on AIM today, November 20th, under the ticker AGM and at a price of 155 pence per share valuing the company’s equity at around $42 million.

Here at Nanalyze, we hold the lion's share of our investing dollars in a portfolio of 30 dividend growth stocks. Find out which ones in the Quantigence report freely available to Nanalyze subscribers. 

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