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Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes Income TaxesThe tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities were as follows (amounts in thousands):
SuccessorPredecessor
December 31,
2021		December 31,
2020
Deferred tax asset
Tax loss carryforwards$32,983 $2,323 
Capitalized research and development8,734 — 
Research and development credits6,967 — 
Other1,016 16 
Total deferred tax asset$49,700 $2,339 
Valuation allowance(49,045)(2,339)
Deferred tax asset, net of allowance$655 $— 

The Company regularly assesses its ability to realize its deferred tax assets. Assessing the realization of deferred tax assets requires significant judgment. In determining whether its deferred tax assets are more likely than not realizable, the Company evaluated all available positive and negative evidence, and weighed the evidence based on its objectivity. After consideration of the evidence, including the Company's history of cumulative net losses in the U.K., France, Germany and the USA, the Company has concluded that it is more likely than not that the Company will not realize the benefits of its U.K., French and German deferred tax assets and accordingly the Company has provided a valuation allowance for the full amount of the net deferred tax assets in those territories. The Company has also concluded that it is more likely than not it will not realize the benefits of the deferred tax assets in its principal operating entity in the United States and has provided a valuation allowance for the full amount of the net deferred tax asset in that entity. The Company has considered the Company's history of cumulative net profits in two of its other operating entities in the United States, which carry out services for other entities in the group, estimated those entities' future taxable income and concluded that it is more likely than not that the Company will realize the benefits of the deferred tax assets in those entities, and has not provided a valuation allowance against the net deferred tax assets in those entities.
For the period from January 30, 2021 to December 31, 2021, the valuation allowance increased by $30.5 million. On January 29, 2021, the Company acquired $16.1 million in net deferred tax assets in its acquisitions of the Centessa Subsidiaries, primarily comprised of tax loss carryforwards and research and development tax credits. A full valuation allowance was recorded against these acquired deferred tax assets as it was concluded that it was not more likely than not that the Company would realize the benefits of the deferred tax assets, resulting in the remaining increase in total valuation allowance from December 31, 2020 to December 31, 2021. A full valuation allowance had been recorded against the Predecessor Group’s net deferred tax assets as of December 31, 2020. The valuation allowance increased by $1.3 million during the year ended December 31, 2020.

The income tax provision consists of the following (amounts in thousands):
SuccessorPredecessor
December 31,
2021		December 31,
2020
Federal
Current$581 $— 
Deferred(495)— 
State
Current188 — 
Deferred(160)— 
Foreign
Current— — 
Deferred— — 
Income tax provision$114 $— 
A reconciliation of the United Kingdom (“UK”) income tax rate to the Company’s effective tax rate is as follows:
SuccessorPredecessor
Period from January 30, 2021 through
December 31, 2021
Twelve Months Ended
December 31, 2020
Twelve Months Ended
December 31, 2019
Statutory tax rate benefit19 %19 %19 %
Non-deductible write-off of in-process R&D(11)%— %— %
Other non-deductible expenses(2)%(1)%(1)%
Enhanced research and development expenses3 %15 %19 %
Losses surrendered for tax incentive(5)%(28)%(33)%
Non-taxable research and development incentive2 %4 %5 %
Change in tax rate1 %1 %(1)%
Effect of overseas tax rates1 %— %— %
Change in valuation allowance(8)%(11)%(8)%
Effective income tax rate— %— %— %

The following table summarizes carryforwards of federal and local net operating losses (NOL) and research tax credits (amounts in thousands):

SuccessorPredecessor
December 31,
2021		December 31,
2020
UK$82,156 $12,393 
US$34,059 $— 
France$19,710 $— 
Germany$11,062 $— 

The Company will recognize interest and penalties related to uncertain tax positions as a component of income tax expense. As of December 31, 2021, the Company had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in the Company’s Consolidated Statements of Operations and Comprehensive Loss. Due to NOL and tax credit carry forwards that remain unutilized, income tax returns for tax years from 2019 and 2020 remain subject to examination by the taxing jurisdictions. The NOL carryforwards remain subject to review until utilized. The carryforwards in the UK, France and Germany do not expire, in the US, while the majority of Federal NOLs do not expire, certain Federal NOLs ($3.2 million) and all State NOLs ($13.5 million) expire beginning in 2036.
Section 382 of the Internal Revenue Code of 1986, as amended (the Code) provides for limitation on the use of net operating loss and research and development tax credit carryforwards following certain ownership changes (as defined in Code) that could limit the Company’s ability to utilize these carryforwards, in relation to its principal operating unit in the US. Pursuant to Section 382 of the Code, an ownership change occurs when the stock ownership of a 5% stockholder increases by more than 50% over a three-year testing period. The principal US operating unit may have experienced various ownership changes, as defined by the Code, as a result of past financings and may in the future experience an ownership change. Accordingly, the Company’s ability to utilize the aforementioned carryforwards may be limited. Additionally, U.S. tax laws limit the time during which these carryforwards may be applied against future taxes. The Company has not yet performed an Internal Revenue Code Section 382 study in connection with changes in control of its principal operating unit in the US.