3i snaps up Microsulis stake

WHILE bid speculation swirls around investment group 3i, it is putting £14m into a medical research firm that pioneered an alternative to a hysterectomy.

The investment in Microsulis is the largest technology deal by 3i in a year. It is part of a £25m fundraising by Microsulis, based in Hampshire.

Shares in 3i are well below their peak in the dotcom boom, when it became heavily exposed to technology. The shares, £16 in 2000, fell to just over £4 a year ago.

They have rallied to 605p, up 17 1/2p last night, valuing the group at £3.7bn. US banks Goldman Sachs and CSFB and private-equity groups KKR and Blackstone are among those that may be tempted by 3i's portfolio.

The group is seeking a new chief executive to replace Brian Larcombe, who is retiring. It is expected to report upbeat annual figures tomorrow, with profitable sales and fresh investments.

For the first time in two years analysts are not expecting painful write-downs.