Back in early Feb I was anticipating Westaim with it's partners to build a full blown plant in Canada. This of course was speculation. The stock on this speculation went to about 3.90 and then when news came out that they were building a pilot plant the stock nose dived to 2.74. Ten million dollars was gave to Westaim which the CEO almost sounded in the stockholders meeting like it was almost a gift. This is just my opinion but I believe DNP and SANYO are in the back waiting. We have seen Sanyo stated in articles and not mentioning Westaim. Sanyo is staying course, they aren't going to stray from their plan for the future and mention Westaim at this time. They have stockholders looking at them too. I call this a collaboration of some sort. Now some excerpts from the 6K:
iFire's TDEL technology has attracted the attention of major industry players
from around the world. iFire has a non-exclusive technology collaboration
agreement with Sanyo Electric Co., Ltd. and, in early 2003, added Japan's Dai
Nippon Printing Co., Ltd. (DNP) as a development partner to help scale its
displays from 17 inches in size to 34 inches. In January, 2004, iFire and DNP
expanded this relationship to include financing for pilot production.
Collaborations with Sanyo and DNP have been extremely beneficial, resulting in
display improvements and achievements. Most notably, iFire produced a
defect-free 17-inch prototype and proved the simplicity of the technology by
producing its first high-definition 34-inch full-color prototype in its
research and development facility.
Now my two cents: Big players aren't going to change the way they do business until I get some guarantee. And I believe that guarantee is:
iFire should have an estimated 30 to 50 per cent cost advantage in both capital
and module costs in a mature manufacturing environment. This was brought up when iFire commissioned an independent study in 2003 to compare its manufacturing model against both LCD and PDP. Conducted by Industrial Design and Construction (IDC), a highly respected
engineering firm involved in high-technology facilities design, construction, maintenance and operations, the study developed models of a mature Generation 6 manufacturing environment for all three technologies. Based on the model
assumptions, calculations indicate iFire could have an estimated 30 to 50 per cent advantage in both capital and module costs.
Now the big word is could have an estimated 30 to 50 percent. So with this pilot there is the guarantee. By the pilot production the big boys could sell this to their stock holders and the board with no trouble now.
But you already knew most of this except my opinion.
1. You are right It is always tough to transition from R&D to manufacturing. Hence the pilot plant. The proof in the pudding is in the eating, though. Fair enough.
3. Slower than what? Jumping straight to commercial manufacturing without knowing how to do it with maximum efficiency? Why?
"So far I haven't heard anything solid about potential partnership of polit plant."
Did you mis-speak, or is the following not solid enough?
"February 3, 2004 � iFire Technology Inc. today announced it has reached a US$10-million financing agreement with Dai Nippon Printing Co., Ltd. (DNP) of Japan. The funds will cover one-third of the capital cost to upgrade iFire�s Toronto facility to enable pilot manufacturing of product-quality mid-30-inch sized flat panel displays."
You: "The good thing is if it works, westaim can harvest all the fruits. However, I don't think it's a good idea to do it alone."
same WEDX PR: "It is the intention of both parties that the financing relationship will be resolved as part of an expanded commercial agreement as the technology moves through pilot and into commercial production, or through repayment by iFire."
So you agree with WEDX.
"2. $40M Canadian is not enough."
Why not? iFire and DNP have explicitly stated $40M as the cost (see above).
So far I haven't heard anything solid about potential partnership of polit plant. I have to assume that Westaim has to come up with the financial support itself.
The good thing is if it works, westaim can harvest all the fruits. However, I don't think it's a good idea to do it alone.
1. R&D and Manufacturing are two different animal from my telecom experience. R&D people aren't good at manufacturing process.
2. $40M Canadian is not enough. If iFire can pull it off with $40M, I'd say iFire alone is worth $1B.
3. It will be slower.
Oops. That laast note was meant to be signed "nic" not "jic" and it was supposed to be from this id, not my other one. Not that it matters, but I don't want that to distract from substance. Sorry.
"They're building a pilot plant, then hope to sign on a partner to build a larger plant. Maybe DNP. iFire can't afford a larger plant on its own."
Yep. "Probably DNP" I would say, given the wording of the pilot plant agreement. They do seem to be quite warm to the "iFire inside" model.
I am curious about tomorrow's financials. Two things stand out. First, I wonder if we will be getting an inkling of this year's (accelerated) cash burn rate tomorrow. And I wonder how the market will react, if we do. (I really do wonder, this is not code for "I bet it will react badly"--I am as often wrong as I am right when I try to guess short term market sentiment.) Second, I look forward to seeing whether Acticoat's sales have continued to grow at a healthy clip. It is probably a bit too early for J&J's new silver bandage (h**p://www.jnj.com/news/jnj_news/20040413_120700.htm ) to make a dent, if it is going to make a dent.
Is anyone going to the AGM tomorrow?
It seems they would be able to get financing if the pilot plant proves, the quality and cost effectiveness. They also have a pretty good cash position now. I forget where I read that the machining for the plant had a waiting list or period? Also I read where the front-end tech could be intigrated into other plants and utilize some of the equipment from them so that Sanyo building a plant for that would possibly give them a head start to ifire production. IMO. Good things come to those who wait.
Am I correct in understanding the iFire technology is at least a year or two away from commercialization or major production?
This looks like a very good technology, but is more of a long term stock buy.
This might help out too from their 6K filing.
In the first half of 2004, iFire expects to complete the installation of the remaining prototype production toolset and focus on optimizing processes to improve performance and reduce defects on prototype 34-inch displays. Upon successful completion of these milestones, iFire expects to begin construction of a pilot production plant at its Toronto facility, at a cost of approximately $40 million in 2004.
Pilot production is intended to confirm iFire's low-cost manufacturing model and to serve as a blueprint for a larger, full-volume production facility. Upgrading of the Toronto facility to accommodate the required tools for pilot production is underway and will be complete by the end of 2004 or early 2005, with product-quality displays being produced in 2005. Following pilot production, iFire expects to form commercial ventures with manufacturing partners to build and operate large-volume facilities that will produce high-definition flat panel modules for the TV market. iFire anticipates that its first consumer products will be available in 2006.
But in order to have major production in a year, you need to setup plant now. I'm hoping for the contract news in a year.
However, it's still not clear to me if the "major production" means "to begin planning major production" or "to enter major production" or "have product in the market for general availability".
iFire is half of Westain, the other nano tech actually have some revenue. If the nano bubble starts, it'll run up as well.