Transense Negotiating with RFID Supplier

It has emerged that battery-less TPMS developer Transense Technologies is in “early discussions” with a UK-based aftermarket TPMS supplier. The company in questions has developed a vehicle management system providing “cradle to grave” tyre information, which is said to be of a particular interest to the OTR and truck markets. The system in question incorporates a hand-held reader which reads a tyre patch RFID tag and measures tyre tread depth and pressure on a manual basis. The companies are said to be currently working on ways to incorporate SAW technology into their product.

The news is set against a varied year for Transense. Eventful is an understatement for describing Transense Technologies’ last 12 months. Nevertheless, company chairman, David Kleeman, described the last year as “probably been the most eventful in Transense’s relatively short history.” First there was the proposed reverse takeover of the Bishop Technology Group, which shareholders rejected in November 2007. Then there was the difficult task of raising £4 million at the beginning of 2008, a time when financial markets were less than keen to lend.

Revenue for the year was £145,000 (2006 – £604,000 which included a £500,000 licence fee). Pre-tax losses for the year increased to £2.754 million (2006 – £1.324 million), exacerbated by the significant abort costs from the failed Bishop transaction and the cost of the Board restructuring. Ouch.

Looking at the company’s most recent financial report shows that the company dropped one real clanger (as far as shareholders are concerned). That is announcing that in 2007 there was no repetition of any licence fee income from Honeywell, as the series of upfront payments agreed in the original licence agreement had already been paid and accounted for by 31st December 2006. Ouch again.

An earlier technology tie-up with Michelin (which resulted in the development of the eTire II) has reportedly made “no meaningful progress to date.” Also, for strategic reasons, Lear has not proceeded with the Transense battery-less TPMS and the agreement has been terminated. The 2006 agreement was the automotive supplier to develop a new system to comply with the US Transportation Recall, Accountability and Documentation (TREAD) Act, which requires all cars and light trucks registered after 1 September 2007, to have tyre pressure monitoring systems.

On a more positive note, apparently four members of the Transense team recently returned from Minneapolis where they had “two full days of meetings with senior members of the Honeywell team discussing ongoing and potential projects across a wide range of automotive and industrial applications.”

Several Board changes have occurred subsequent to the rejection of the Bishop proposal. David Kleeman’s predecessor as Chairman, Peter Woods, and Tony Baldry retired immediately, followed shortly afterwards by Graham Eves, who resigned as Commercial Director. Howard Pearl, Finance Director, and Jim Perry, who was Chief Executive for 17 years, have also recently retired as Directors.

The Board now comprises Ray Lohr and Rodney Westhead. The new members are: Melvyn Segal and Graham Storey, who have been shareholders in Transense for several years. The position of Managing Director has yet to be filled, although discussions with a certain industry “heavyweight” are expected to be completed in the near future.