James Cropper plc, the Kendal-based Advanced Materials and Paper & Packaging group, has entered into an agreement for the sale of “certain non-core intellectual property assets associated with a manufacturing process developed by the Company’s Centre for Innovation.”

Cropper said the assets have been sold to an “unconnected buyer operating in the engineering sector” for an initial cash consideration of €1.75 million, together with deferred cash consideration of up to a further €250,000 which is payable “should a patent be granted in respect of the assets by the European Patent Office before 31 December 2030.”

As part of the agreement, Cropper retains the ability to receive cash royalties “calculated as a proportion of revenues generated by projects to deploy the assets in the paper, pulp, board and tissue industries over the next nine years (capped at €2.2m in aggregate).”

The assets will remain available to James Cropper “without fee under licence for the purposes of any required application at its own manufacturing sites.”

James Cropper CEO David Stirling said: “I am delighted that we have been able to generate and realise significant value through the development of technology within our Centre for Innovation which will be used to invest in the Group’s growth strategy.

“The agreed transaction enables us to retain the benefit of these non-core developments, together with the potential to generate further income over the next nine years.”