Tuesday, November 27, 2018

News: Xeros aims to raise £20m to complete commercialisation

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Rotherham-based Xeros Technology Group plc has announced plans to raise £20m as it aims to complete the commercialisation of current applications by the end of 2019.

Based on the Advanced Manufacturing Park (AMP), Xeros is a Leeds University spin-out that uses polymer technology to significantly reduce the amount of water used in a number of major applications. The AIM-listed firm is moving to "IP-rich, capital-light" business models.

In an update to the stock exhange, Xeros bosses said that they intends to raise approximately £15m before fees and expenses by a placing of 150,000,000 new Ordinary Shares with existing and new institutional investors at a placing price of 10 pence per share. Qualifying Shareholders will also be given the opportunity to subscribe for up to 49,588,971 new Ordinary Shares through an open offer to raise up to £5m before expenses.

Mark Nichols, chief executive of Xeros, said: "These additional funds will allow us to continue to execute on our IP-rich, asset-light strategy to commercialise our technologies, which address the key global environmental issues of water scarcity and pollution.

"The commercial benefits and sustainability improvements that our technologies deliver have been validated by a number of recent contracts. These clearly demonstrate that our platform technology is capable of broad deployment in scale industries.

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"Our focus is on increasing the commercialisation of our technology in each of our markets working with channel partners and manufacturers whose businesses and customers are facing ever increasing pressure on their water use."

Recent contracts include a "Symphony Project" licensing deal which is set to see Sea-Lion integrate Xeros' technology in its commercial washing machines and sell them though its own extensive distribution network in China on an exclusive basis. It expects to receive first revenues in 2019.

Also in commercial cleaning, which Xeros has now renamed Hydrofinity, export orders through overseas partners have also been secured in America, South Africa and the UAE.

On domestic cleaning, Xeros previously said that it is in discussions with leading domestic washing machine brands regarding licenses for China, India, EMEA, the Americas and Asia Pacific over a project which enables Xeros technology to be embedded in the production lines of existing manufacturers. Xeros will look to receive up-front payments and a royalty per machine sold.

In tanning, which uses huge volumes of water during the process, Xeros recently signed a ten year contract with LEFARC to convert its re-tanning operations in Mexico to use Xeros' patented polymer technology. Xeros expects to convert further customers, grow its contract base and plans to trial its technology in the upstream tanning process in 2019.

Xeros is also targeting the completion of trials with denim and garment manufacturers in 2019 and, if successful, would pursue commercial agreements with first revenues in 2019.

Xeros website

Images: Xeros

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