Oxford Instruments is in a binding agreement to sell its quantum business Oxford Instruments NanoScience to Quantum Design, a US-based provider of products and services for scientific, academic and industrial research, for £60m (c.1.0x Sales) cash consideration including up to £3m of deferred consideration contingent on future revenue from quantum scaling systems In FY25 the quantum business generated £59m of sales and £1m of adj, operating profit, returning to both growth and profitability following a £5m loss in the prior year. The sale is set to be immediately earnings enhancing and beneficial to margins which are set to improve by 100bps, in line with the strategy outlined in FY24 results. The divestment streamlines Oxford's operations and enhance group growth and margin metrics. Although back in profitable territory, the quantum business required further R&D investment, and the timing and potential of commercial scalability remains uncertain. The deal is set to complete in Q3 of FY26. Given the strength of the balance sheet (consensus models net cash of £87.7m), the Board has decided to return £50m to shareholders via a share buyback which will commence before the deal completes and is expected to take 9-months. Delay to preliminary results: FY25 results which were due to be announced this morning have been delayed at the request of the auditor, BDO. This is a localised issue and management do not expect any change to adjusted numbers or cash. Valuation: On our existing forecasts, Oxford Instruments (March y/e) trades on 16.8x FY26E P/E and 9.6x EV/EBITDA, falling to 15.5x and 8.5x respectively in FY27E. This compares to its peer Spectris that has received an offer from Advent (see here) with an implied FY25E valuation (Dec y/e) of 23.8x P/E and 14.8x EV/EBITDA (FY26E 20.1x P/E, 12.6x EV/EBITDA which reflects some market recovery assumed in our forecasts).