SCOTTISH patents agency Murgitroyd Group has received a takeover bid from Sovereign Capital Partners, the London-based private equity firm.

Murgitroyd said it had received an offer valuing the company at about £61 million and founder and chairman Ian Murgitroyd’s stake at around £16m.

The Glasgow-based firm said negotiations were at an advanced stage over the potential deal in a statement to the London Stock Exchange.

The junior Aim-listed company’s news ended speculation amid shares activity in recent weeks.

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The bid put the shares at 675p and the proposal assumes that the recently announced final dividend of 15p per share will be paid to shareholders.

The firm, which has business in the UK and US with offices across Europe including Milan, Helsinki, Nice and Munich, earlier this year appointed corporate big-hitter Willie MacDiarmid as deputy chairman.

The firm also earlier said it was adopting a more traditional boardroom format with the chief executive and finance director roles being split, with Ed Murgitroyd becoming chief executive of Murgitroyd Group.

The board noted the proposal is non-binding in the statement.

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The firm said: “The board of Murgitroyd notes the recent movement in the company’s share price and confirms that it is in advanced discussions in relation to an indicative proposal received from Sovereign Capital Partners LLP to acquire the entire issued and to be issued share capital of Murgitroyd at a price of 675 pence in cash.

“The proposal assumes that the recently announced 

final dividend of 15 pence per share will be paid to shareholders on the register as at close of business on October 11, 2019 as anticipated.”

In September Murgitroyd said the Chapman IP business it acquired had been "integrated successfully" after the £6.6m takeover of Southampton-based Chapman IP in February.

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The board noted that the proposal is non-binding and “accordingly there can be no assurances that an offer will ultimately be made for the company”.

Sovereign Capital Partners has until November 12 to withdraw the offer.

The firm added: “The proposal indicates that if any further dividend and/or other form of capital return or distribution is authorised, declared, made or paid or becomes payable in respect of Murgitroyd shares - other than the final dividend - on or after the date of this announcement and prior to the date on which, Sovereign having announced a firm intention to make an offer for the company, such offer becomes or is declared unconditional in all respects or otherwise becomes effective.”

Murgitroyd said: “Discussions with Sovereign are at an advanced stage with due diligence enquiries complete.

“The board confirms that, should Sovereign or an entity controlled by Sovereign announce a firm intention to make an offer, the board's current intention is to recommend that Murgitroyd shareholders accept the offer. A further announcement will be made in due course.”

Chairman Mr Murgitroyd said in September revenue and profit allowed an increased final dividend. Shares dipped 2%.