Magnetic attraction

Dunedin-based Scott Technology has bought a majority stake in IRL associate company HTS-110^[?], which designs, manufactures and sells powerful electromagnets that utilise IRL’s world-leading superconducting technology.

Applications for HTS^[?]-110’s products range from cutting-edge nanotechnology to the manufacture of ultra-high capacity computer hard drives, and from accelerated drug development to increasing yields in biofuel plants.

Scott Technology specialises in the design and manufacture of automated production and process machinery for a range of industries including appliance building and meat and mineral processing.

The company’s global presence and experience in developing and selling high-tech, high-value products both in New Zealand and internationally will now be harnessed to take HTS-110 to a new level of capability, growth and development.

“Superconducting technology is an exciting area that we have no doubt is going to take off,” says Scott Technology Managing Director Chris Hopkins.

“There is steadily increasing demand for HTS-110’s electromagnets, with recent approaches including interest from organisations wanting to use them for wind turbines, pharmaceutical production and a range of materials analysis.”

According to Hopkins, the acquisition of HTS-110 “ticks all the boxes for Scott Technology”.

“It is a world-leading technology and the market is young, with excellent prospects for revenues and earnings to grow significantly as the product range moves through to full commercialisation.

“We see the technology as being a key link in our industrial process chain in the future.”

Formed in 2004, HTS-110 has grown into a multimillion dollar company with a strong development pipeline and a healthy order book.

Scott Technology’s expertise in scaling up machinery will enable HTS-110 to enhance its product offerings and, coupled with its growth ambitions for the company, will increase the demand for supporting components and services from local suppliers and industrial partners.

Scott’s strategy for HTS-110 is to grow its market footprint, target industrial users and create alliances to provide integrated solutions for selected industries.

David Moore, CEO of Wellington-based Sapere Research Group and formerly CEO of the Government’s drug purchasing agency, Pharmac, has been appointed Chairman of HTS-110.

Superconducting technology enables the transmission of electricity without resistance or the loss of energy. It can also be used to generate very strong magnetic fields, with HTS-110’s magnets used for systems such as nuclear magnetic resonance (NMR^[?]) and magnetic resonance imaging (MRI^[?]) machines.

IRL has been running a superconductivity research and development (R&D) programme for nearly 25 years, and its scientists and engineers are at the forefront of both advancing fundamental understanding of the technology as well as developing real world applications.

In coming years the global market for superconducting applications is expected to be worth billions of dollars.

Under the terms of the sale of HTS-110, IRL and American Superconductor Corporation have diluted their shareholdings, and venture investment fund Endeavour Capital and several minority shareholders have sold their stakes to Scott.

Hopkins says it was important to Scott Technology that IRL retained a significant shareholding in the company.

“They are undoubtedly world leaders in this area and are continuing to invest in R&D that will support our commercial outcomes for the company.”

IRL Chief Executive Shaun Coffey says the HTS-110 share sale demonstrates how technology developed at IRL is helping to create a new high-tech sector in New Zealand.

HTS-110’s powerful electromagnets have a wide range of applications – including in wind turbines, pharmaceutical production (above) and materials analysis. Their world-leading technology is based on IRL’s research into superconductors, which lose all electrical resistance at low temperatures.

“Our long-term commitment to maintaining a strong capability in superconducting technology across the full R&D spectrum, from fundamental research through to developing new engineering techniques to support industrial applications, is paying off.

"It’s exciting to see that commitment and investment acting as a launch pad for HTS-110 to move into a new phase of development in partnership with a top technology firm.”