31 August 2010


SPTS invests AUS$5.2m for 19.9% stake in BluGlass

BluGlass Ltd of Silverwater, Australia, which has developed patented GaN-on-glass LED technology, has entered into a joint venture agreement with SPP Process Technology Systems Ltd (SPTS) of Newport, Wales UK, the plasma etch & deposition equipment subsidiary of Japan’s Sumitomo Precision Products Co Ltd (SPP).

Spun off from the III-nitride department of Macquarie University in 2005, BluGlass has developed a low-temperature process using RPCVD to grow materials including gallium nitride (GaN) and indium gallium nitride (InGaN) on glass substrates for the production of LEDs, with what is reckoned to be significant low-cost potential and inherent scalability. The JV will focus on completing the development and commercialization of BluGlass' proprietary RPCVD technology, which can potentially offer cost, throughput and efficiency advantages for the production of nitrides.

With more than 400 staff and 35 locations worldwide, SPTS aims to expand its product portfolio into adjacent equipment sectors. BluGlass has developed promising technology that fits well with SPTS’ technical roadmap and product/customer base, believes SPTS’ president & CEO Dr William Johnson. “SPTS and BluGlass intend to bring the RPCVD technology to market on field-proven production platforms, offering significant competitive advantages for customers in the rapidly expanding high-brightness LED industry,” he adds.

SPTS will become a cornerstone investor in BluGlass, subscribing for about 47.7 million shares at an issue price of $0.11 each. This will give SPTS a post-placement holding of 19.9% of the expanded issued ordinary share capital in BluGlass, to be completed in two tranches. The initial tranche of 23.297 million shares (worth $2.562m) is to be placed within 5 days. The remaining 24.432 million shares (worth $2.687m) exceeds BluGlass’ placement capability and requires approval by its shareholders (to be sought at the firm's annual general meeting on 1 November).

BluGlass has also agreed to offer SPTS the right to participate in any future issue of securities to maintain its holding at the time, and SPTS will have an ongoing right to nominate a representative to BluGlass’ board (provided that SPTS maintains more than a 10% stake in the firm). BluGlass’ board will hence be recommending at the upcoming AGM that Johnson is nominated for a board seat.

“SPTS is the perfect-fit partner for our technology and its commercialization,” says BluGlass’ CEO Giles Bourne, who adds that SPTS’ existing plasma deposition equipment manufacturing expertise and capabilities, along with its substantial customer base, are complementary and synergistic to BluGlass’ commercial goals. “This is a major commercial milestone for BluGlass,” he believes.

The JV will be co-capitalized by the two parties exclusive and additional to the initial $5.2m investment into BluGlass, which will maintain a majority 51% stake in the equipment-making JV and retain 100% ownership of intellectual property related to devices (e.g. LEDs and solar cells). Since the JV will focus exclusively on developing the RPCVD equipment portfolio, BluGlass will exclusively license its RPCVD intellectual property for the purposes of the JV with SPTS. BluGlass will continue to operate its Silverwater facility and, through the JV, will establish RPCVD development and demonstration equipment at SPTS’ facilities.

“This joint venture will enable BluGlass and SPTS to emerge as a front runner in supplying process equipment for the LED and PV solar industries,” believes Bourne.

See related items:

BluGlass commissions fifth-generation RPCVD system

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