Listen to our latest Investing Matters Podcast episode 'Uncovering opportunities with investment trusts' with The AIC's Richard Stone here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
https://www.londonstockexchange.com/news-article/NANO/project-extension/14974844
Great news.....'The extension increases the Board's expectation for revenue in FY21 by approximately 40% with the balance of the project revenue to be earned in the first quarter of FY22. The contribution generated allows us to maintain our current operational business for the duration of the extension and our overall cash runway to H2 of calendar year 2022.'
Surely, this extension must be with ST, why not Just say it - “ an important European electronics customer.”.
Fantastic timing for a (significant) bread and butter RNS like that. The stars are all aligned for Nanoco. A big win against Samsung will bring in enormous revenue to pursue these medium term company goals. It's a long term path towards making another British tech giant to be proud of
They're obviously not allowed to say who it is. European. Isn't STMicro American? Odd.
STMicroelectronics is a French-Italian Dutch-domiciled multinational electronics and semiconductors manufacturer headquartered in Geneva, Switzerland resulting from the merger of two government-owned semiconductor companies in 1987: "Thomson Semiconducteurs" of France and "SGS Microelettronica" of Italy. It is commonly called ST, and it is Europe's largest semiconductor chip maker based on revenue. While STMicroelectronics corporate headquarters and the headquarters for EMEA region are based in Geneva, the holding company, STMicroelectronics N.V. is incorporated in the Netherlands.
I wonder now if fears of a fundraiser were behind the muted response yesterday. Ie Nano wouldn’t have the cash to endure a lengthy drawn out road to settlement with Samsung.
This RNS allays those fears for some time yet.
What we need is an investor online meeting and that guy who spilt the beans last time! Can’t remember his name but ME was put on the spot.
Doh! Thanks Morbox. Just me being ignorant.
This is STM in my opinion. This from an RNS in May 2020 which ties in with todays announcement that the project started in May 2020.
"Nanoco Group plc (LSE: NANO), a world leader in the development and manufacture of cadmium-free quantum dots and other nanomaterials emanating from its technology platform, today announces that it has signed a Quantum Dot Material Supply Agreement ('QDMSA' or 'Agreement') with STMicroelectronics International NV ('ST').
The QDMSA is a framework agreement that covers both development work and commercial supply of nano-materials for use in various infra-red sensing applications over an initial five-year period. The Agreement extends the collaboration that was in place while both companies were working for our mutual significant US Customer.
Orders for development work on material for a new application and small scale volumes of an existing material have already been received. The first phase of the development work which started in April is scheduled to last until December 2020.
The new purchase orders are material in size for Nanoco and underpin the extended operational cash runway to Q2 2021, as recently announced in our Interim Results on 30 April 2020. Any further purchase orders will improve that position. The QDMSA also commits ST to certain minimum volumes in the event that future commercial production orders are required.
The old one-two. Still a good move! But why is this second RNS not shown on the LSE website dashcam?
So why now refer to STM as important European customer? It's very similar to the Apple rhetoric.
Presumably STM want to keep product development under the radar. Speaking of which surely it's only a matter of time before our QD's are used for military applications. Not that I'm in favour of such developments apart from potentially profiting in this case.
I am just speculating/guessing, but could STmicro want customers focusing on the products they are offering now, rather than holding off for the product coming next? I assume Nanoco products are not part of their current product line and they seem to have only just introduced new products.
https://www.nasdaq.com/press-release/stmicroelectronics-introduces-high-performance-gan-family-for-automotive-applications
BT said the trial would only take a week including result and judgement of initial financial award. The appeal however is another story entirely. I think I remember he said it could take a couple of years but others may have a better memory.
I doutb STMicro would be trying to discourage customers from signing up for new product lines Screenlearner. I think development just takes a long time. 1 - 2 years with STMicro (3 - 4 if you count the time spent with Apple) and then there'll be 1 - 2 years where STMicro works with OEMs on final products. Contract still alive is the important point for me.
BtB, sensor customers woudn't be concerned with the litigation. It's a whole different type of nanoparticle no doubt protected by different patents. Diaplay partners would have free reign if Sansumg wins though. Anyone could copy NANO's dot production for screens.
BTB, you are somewhat cynical of the RNS, and with some justification in that similar projects appear to have gone nowhere, it is always pie in the sky. However one day it might just work!!! Added to which, and this is important there are upside revenue implications. Even though these may not be mega they are much better than a kick up the backside. So all in all a good RNS and I am not cynical. As for my Nano shares I am just sitting on them until D day whenever that is but I agree with your point about Samsung doing everything in their power to whittle down the sum and to prevent it becoming payable. I am confident Nano will win.
I believe there will be an out of court settlement prior to October along with a supply agreement.
BTB - I understand the logic behind selling on the spike of PTAB (if there even is one - who knows the way this has gone last couple of days!) but to me that's bad advice indeed. Whilst it's hardly odds on, it would be foolish to discount the prospect of an out of court settlement or (even less likely I know) some form of buyout.
If you bought in at 10p then fair enough it's a quick trade and likely a three bagger, but all long term holders are waiting for the heyday.
And just a side note, if you are invested here, it seems odd you are so downbeat about Nano. On more than one occasion I feel that your 'realism' strays into pessimism. Whilst none of us want mindless ramping on this BB (and to be fair I find the balance and consideration of the posters here make it a great BB) I think that as PIs we have faith and a degree of optimism about the companies we invest in, else why invest here in the first place?
To me, if we touched 30p on speculation alone, and are at 28p with the two RNSs we've had, then we just have to put it down to the fact the market has it wrong for now...
They only asked for $10m originally though. Samsung offered them $6m. Be over $4bn (20x$200-250m) if it works out that way for us, $12bn+ if you factored in worldwide sales. Some hopes I guess, but just putting it into context.
Wouldn't you expect Mintz to be far more persuasive, aggressive and effective than the Kaist lawyers though? They nailed the Markman. Samsung attempts to delay and whittle could also face a publicity backlash like they have never seen before if UK journalists sniff the story. They should really be considering their options, imo, but will probably just stumble on.
Contract RNS is a mild fillip, extending the cash runway a bit more, keeping the engine ticking
Selling on settlement should be done only with the intention of buying back ASAP, since orders should quickly flow in. Let's not forget that some Mintz lawyers assigned to this case have strong licensing expertise. The Mintz relationship raises Nanoco's business acumen and connections to new levels. Nanoco and Mintz will almost certainly be strategizing appropriate post settlement steps.
There is another issue we have not discussed. Any Samsung settlement must address the issue of how to supply Samsung with QDs. This presents a dilemma, because Samsung cannot be trusted. I even have doubts about Dow/Dupont. My reading indicates that, because Samsung is a quantum dot manufacturer and thus a Nanoco competitor, Nanoco is not required to grant Samsung a manufacturing license. Yet, Nanoco does not presently have sufficient capacity to supply Samsung. Thus, any settlement should consider granting Nanoco ownership of Samsung's quantum dot factories and include an iron clad, long-term contract with very substantial penalties.
The announcement states that this new contract moves the project from stage 1 to stage 2. STMicro has been in stage 2 for quite some time. Therefore, I believe this contract to be with a different company.
Regarding why they are secretive, Nanoco and their customer are possibly seeking to avoid disruption and backlash from Samsung, as seems to have happened so often in the past. Samsung's influence extends across the globe, and Samsung does not hesitate to use it.
Would Samsung be able to rent said factories to Nanoco at a peppercorn rate to allow a supply to be produced instead? Depending on where the factories are they might not be worth as much to Nano as Samsung to due potentially difficult supply lines and the logistical hassle of staffing/running/supplying said factories so I hope Samsung doesn't try to offset some of the cash settlement for them or at least if they do I hope nano accepts them at a much reduced value. Excellent point though! That will definitely spice up any nascent settlement negotiations which may be about to happen.
LOL, what on earth for?
Nanoco have capabilities themselves to readily supply QD's in bulk from their Runcorn facility, plus Dow/Duponts mothballed facility in Korea, originally built to supply Samsung (situated directly next door to one of their factories).
Earth to Mars: Runcorn is much too small to supply Samsung, much less meet non-Samsung demand. Are Dow/Dupont trustworthy (have not demonstrated so thus far)? Besides the fact that Dow/Dupont have been a huge disappointment, the status of the Dow/Dupont factory is unknown, and the licensing fee would need to be adjusted significantly upward.
It would take years to build the plants needed to supply Samsung. Yet, we need to make sure that the Samsung factories are no longer under Samsung's control. Besides, forcing Samsung to turn over plants (that it had no right to build) to Nanoco seems to constitute reasonable punishment.