Thursday, February 18, 2016

News: Metalysis secures £20m as it heads for IPO

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Neil Woodford, one of the most respected fund managers in the UK, has invested £10m in Metalysis, the Rotherham-based innovator that is commercialising a low-cost way to manufacture titanium and other specialist powder metals.

Metalysis holds the worldwide exploitation rights to the FCC Cambridge process which sees specialist powder metals created in a simple, cost effective process with significant environmental benefits.

The Manvers company employs around 50 staff and is in the process of commercialising the technology to produce titanium, tantalum, and related high value alloys. These are used increasingly by major worldwide industries such as aerospace, marine, medical, chemical, automotive and electronics.

As part of the latest round, Australian minerals firm, Iluka Resources Limited, has agreed to invest an additional £6m in Metalysis Limited with an undertaking to commit a further £4m before July 15 2016. Iluka, which is involved in mineral sands exploration, project development, operations and marketing, invested £12m in 2014 and will up its stake to over 28% and have the right to appoint two directors to the board.

Last year, Metalysis said that it was an important time for the company's commercialisation and development, which will see a significant expansion of its production capacity in the UK, in addition to exporting its technology internationally through licensing agreements and joint ventures.

The investor and grant backed Cambridge University spin out has developed the electrochemical reduction process to transform metal oxides, such as ores, directly into metal powders in a single step.

Metalysis' strategic focus is titanium, which can be used in a variety of new applications to satisfy the growing demand for low cost, light weight, high strength and corrosion resistant metals. High grade and uniform, the lower-cost powders suit a wide variety of 3D printing needs across a variety of high-tech, industrial and manufacturing sectors. For example, further to the 3D printing of aerospace and automotive components, Metalysis has recently completed a programme with TWI, a UK leader in materials technology innovation which has a base on the Advanced Manufacturing Park (AMP) in Rotherham, which demonstrated the feasibility of its bespoke powders for 3D printing orthopaedic hip implants.

The company, which is also working on major development projects with GKN and VW, has set out a plan for an initial public offering (IPO) to float on the stock exchange.

David Robb, managing director of Iluka Resources, said: "The prospect of commercial volumes of titanium metal powder, direct from rutile and synthetic rutile, at a materially lower cost than current technologies, could drive a dramatic expansion in global demand for titanium metal and titanium alloys. The application of titanium powder in 3D printing also presents potentially significant opportunities in a rapidly expanding market. Such developments would be positive for high grade titanium dioxide feedstock demand.

"Iluka is encouraged by the progress made by Metalysis towards commercialisation of its solid state metal powder technology. Iluka also fully supports the increased focus on titanium as the core element of Metalysis' strategic plan, with a goal to accelerate commercialisation and licensing of its technology."

Dion Vaughan, CEO of Metalysis, added: "Metalysis' development and expansion over recent years has been remarkable, as we have attracted strong market interest and developed great commercial relationships. This latest investment underpins our commitment to deliver against the enormous potential of our disruptive powder metals technology. In Iluka and Woodford Patient Capital Trust, we have outstanding strategic partners and we welcome their support alongside longstanding backers such as Environmental Technologies Fund in realising the commercial potential of our technology."

Neil Woodford announced he was leaving Invesco Perpetual in October 2013 to set up his own fund management business. Investors followed, based on his track record of success, and the CF Woodford Equity Income Fund is now worth over £1 billion. As well as the likes of AstraZeneca, BT and British American Tobacco, the fund also holds shares in Xeros, the Rotherham-based firm that is commercialising a patented system using a unique method of special polymer beads rather than the usual large amounts of fresh water to clean clothes.

Woodford's Patient Capital Trust, which also holds a stake in Xeros, focuses on long-term capital growth, buying stakes in businesses with outstanding intellectual property and helping them fulfil their growth potential through the deployment of long-term patient capital.

Metalysis website

Images: Metalysis

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