Last checked at 25 Jun 2020 07:00
Transense Technologies plc
("Transense" or the "Company")
Transense grants exclusive worldwide licence for iTrack technology and transfers the operational business and trading assets relating to iTrack, to Bridgestone Corporation, Japan ("Bridgestone")
Transense Technologies plc, the provider of sensor systems for the industrial, mining and transportation markets, is pleased to announce that on 24 June 2020, the Company granted an exclusive worldwide licence (the "Licence") to ATMS Technology Limited ("ATMS"), a newly-formed wholly owned subsidiary of Bridgestone, covering all current and future iTrack technology for a period of ten years. In order to capitalise fully on the market potential of the use of the technology, the operational business and trading assets relating to the iTrack system have been transferred to ATMS at net asset value of approximately US$1.01m for cash consideration*.
Under the Licence, ATMS will offer Bridgestone customers worldwide with tyre monitoring systems for all off-the-road ("OTR") vehicles based upon iTrack technology. Transense will receive quarterly royalty payments based upon the number and classification of vehicles upon which the iTrack technology is deployed over a ten year period. ATMS will have an option at the end of the ten year period to purchase the iTrack technology for a nominal cash sum. The initial quarterly royalty based upon OTR vehicles currently utilising the iTrack system will be approximately £0.15m.
On 13 August 2019, Transense announced that it had entered into a Joint Collaboration Agreement ("JCA") by which Bridgestone offered the iTrack system exclusively as a mining tyre monitoring system for tyres 57 inches and above for its OTR customers. Customer response to the tyre management platform has been overwhelmingly positive. Bridgestone will expand this offering to additional OTR customers as it fully integrates the solution into its portfolio.
Bridgestone had provided Transense with a working capital facility of US$0.75m to support the anticipated increase in sales activity. A further loan of US$1.20m was announced on 16 March 2020 to fund additional working capital. The JCA was terminated on 24 June 2020 and the repayment of the loans has been taken into account in the consideration*.
ATMS will employ all Transense staff previously engaged wholly or mainly by the iTrack business, including David Ford as Chief Executive Officer and Graham Storey as Director, Global Sales. David and Graham have resigned as directors of Transense with immediate effect. Nigel Rogers, who now becomes Executive Chairman of Transense, will also be appointed as a Non-Executive Director of ATMS in his capacity as the representative of Transense.
Nigel Rogers, Executive Chairman of Transense commented:
"These arrangements further demonstrate the position of iTrack as a globally-preferred provider of tyre management solutions for the off-the-road (OTR) vehicle market, which we believe will achieve even greater success with Bridgestone."
Tomohiro Kusano, Vice President and Senior Officer, Responsible for G-MAA (Mining, Aircraft, Agriculture) Solutions Business, Bridgestone Corporation, commented:
"This helps move Bridgestone closer to its goal of becoming a leader in sustainable and advanced mobility solutions. As a global solutions provider, Bridgestone will create new value for our customers by delivering tire and mobility-related data that enhances their operations."
* Sale of the operational business and trading assets (excluding IP) relating to iTrack to Bridgestone, in the form of the sale of a number of Transense subsidiaries and in addition certain other assets and liabilities including the existing working capital loans from Bridgestone of US$1.95m. During the year ended 30 June 2019, the iTrack business generated revenues of £1.59m and contributed a loss before tax of approximately £0.71m to the Group results. Actual consideration will be ascertained following the agreement or determination of completion accounts as at 24 June 2020 within a period of 60 days. Net proceeds from the sale of net assets following the repayment of loans, amounting to approximately US$1.01m, will be applied to provide cash resources to fund the growth of the continuing business activities within the Company. The assets sold are expected to include cash of approximately £0.3m. Subsidiaries included in the transfer agreement are iTrack (Australia) Pty Ltd, iTrack North America Inc., iTrack (Slovakia) s.r.o., Translogik South Africa Pty Ltd, and Transense Technologies Chile SpA.
For further information please visit www.transense.co.uk or contact:
Transense Technologies plc Nigel Rogers, Executive Chairman Melvyn Segal, Chief Financial Officer | Tel: +44 (0) 1869 238380 |
finnCap Ed Frisby, Giles Rolls, Matthew Radley (Corporate Finance) Tim Redfern, Tim Harper (ECM) | Tel: +44 (0) 20 7220 0500 |
About Transense Technologies
Based in Oxfordshire, UK, Transense has developed patent-protected sensor systems and supporting technology for use in a variety of diverse high growth markets. The directors believe that Transense's Surface Acoustic Wave (SAW) wireless, battery-less sensor systems offer advantages over legacy wireless sensor systems. Transense is targeting the torque, temperature and pressure sensing markets via its SAWSense division. The continuing business within its Translogik division offers a range of tyre testing equipment aimed at fleet managers and tyre service providers. Further details are available at www.transense.com.
Transense's shares are admitted to trading on AIM (AIM: TRT).
The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.