MARKET REPORT: Nanoco plunges despite David and Goliath victory

Shares in Nanoco tumbled despite the tech company settling its long-running legal dispute with Samsung out of court.

The Manchester-based group will be paid £124m in what will bring an end to a three-year David and Goliath battle.

But the settlement agreed fell short of analyst estimates, which predicted Samsung would pay out around £215m.

Shares plunged 26.6 per cent, or 9.8p, to 27p following the news.

Nanoco filed a lawsuit in February 2020 for patent infringement, alleging that the South Korean tech giant used its ‘quantum dot’ technology without permission across its TVs.

Battle: Nanoco filed a lawsuit in February 2020 for patent infringement, alleging that the South Korean tech giant used its ‘quantum dot’ technology without permission across its TVs

The pair last month were due to go to court in Texas but agreed to settle. Having avoided a jury trial, it left the companies with just 30 days to work out terms of the no-fault agreement.

Nanoco insists that the decision to settle was better than enduring a lengthy legal process, even though analysts said the value of a jury trial award could exceed £400m. Nanoco also claimed last month that any final agreement would likely come in the form of a one-off payment.

Now the group has revealed that under the terms of the no-fault agreement, the £124m settlement fee will instead be paid in two equal instalments. The first will be paid on March 5, with the rest in early February next year.

Nanoco expects to pocket more than £74m after its litigation costs are paid.

Its chairman Chris Richards hailed the outcome as ‘remarkable’ and said the firm would look to use the fee to invest in the business and reward shareholders.

And the tech firm’s boss, Brian Tenner, added: ‘We have successfully validated our core IP against one of the world’s biggest electronics companies.

‘Others operating in our space should take note. We remain vigilant to other potential infringement activity.’

In a separate update, the group said it expects its annual losses to narrow.

The FTSE 100 rose 1.04 per cent, or 81.64 points, to 7901.80, a record high –with traders and investors cracking open bottles of champagne. But the FTSE 250 let the side down and was off 0.10 per cent, or 21.23 points, to 20593.46.

Retail stocks were in sharp focus for Deutsche Bank Research.

The broker upgraded B&M and Marks and Spencer to ‘buy’ from ‘hold’, adding that the outlook for this year is getting ‘noticeably less chilly’.

B&M’S target price was raised to 580p from 460p, while Marks and Spencer was upgraded to 210p from 145p.

Shares in B&M rose 3.4 per cent, or 16.4p, to 493.5p while Marks and Spencer added 1.2 per cent, or 1.95p, to 163p. Heading in the other direction, Asos was down 1.9pc, or 19p, to 963p and Kingfisher sank 1.6 per cent, or 4.7p, to 286.8p. However, Pets At Home rose 0.9 per cent, or 3.4p, to 376p and Wickes was also up 0.3 per cent, or 0.5p, to 152.3p.

Commodity-focused stocks also made gains. Shell added 3.3 per cent, or 76.5p, to 2414p only a day after the oil giant posted record annual profits of over £32billion for 2022.

Miners held firm despite a slump in metal prices.

Antofagasta was up 1 per cent, or 17p, to 1736p, while Glencore gained 1.6 per cent, or 8.9p, to 554.5p and Rio Tinto rose 1.1 per cent, or 64p, to 6128p.

Meanwhile, Centrica plunged 3 per cent, or 2.92p, to 95.26p after the energy watchdog Ofgem barred British Gas from using debt agents to break into people’s homes to install pre-payment meters.

Office space provider IWG took a hit after Barclays downgraded its rating to ‘equal-weight’ from ‘overweight’ and cut the target price to 170p from 190p. Shares fell 0.5 per cent, or 1p, to 196.7p.