(Sharecast News) - Microsaic has signed a new framework agreement with, and an initial contract worth £0.4m from, Innovenn UK - a division of DeepVerge - it announced on Tuesday.
The AIM-traded firm said the agreement was for the refining and miniaturising of existing monitoring equipment for environmental and human health diagnostics.
It said the framework set out the terms for Microsaic to improve and manufacture certain DeepVerge products, and to provide the design, assembly, quality, and project management functions necessary to produce and ship equipment based on DeepVerge-approved specifications, design, and quality requirements.
The agreement extended the parties' existing relationship, which was formalised in the three-year framework announced on 24 March last year, under which Microsaic supplied its own miniaturised mass spectrometry equipment and services on a non-exclusive basis across DeepVerge's global sales, marketing and distribution channels, for healthcare diagnostic and environmental health applications.
Further manufacturing service contracts with DeepVerge could follow under the new framework, the Microsaic board said, subject to the satisfactory execution of the initial contract and mutual agreement.
The mutual goals under the agreement included ensuring the timely availability of quality products in desired quantities, as well as meeting high workmanship and quality standards and ensuring delivery needs were met.
Additionally, the company said DeepVerge and Microsaic would "jointly strive" to achieve value pricing consistent with prudent practices to balance costs and the availability of services materials.
"Microsaic's business model has been transitioned to offer additional services which leverage the considerable depth and breadth of technical design, engineering and delivery expertise within its team," said Microsaic's acting executive chairman Gerard Brandon.
"This new framework diversifies the company's revenues beyond equipment sales of Mass Spectrometers."
Brandon said that by offering the skill sets that created the world's smallest compact mass spectrometer, partner customers such as DeepVerge could outsource their engineering development of existing and new monitoring equipment to concentrate on growing their own business.
"This new agreement illustrates how Microsaic is able to access additional revenues from other innovative companies seeking a high quality product design, development and manufacturing service."
At 1140 BST, shares in Microsaic Systems were down 7.41% at 0.1p, while those in DeepVerge were 1.64% weaker at 15p.
Microsaic (MSYS)