Whilst we've been discussing this on PLT, the following is probably more appropriate on the GBI thread. I'm happy for it to be referenced on PLT, but there's enough going on with Polartechnics (if reports of an announcement tomorrow are correct) to avoid cluttering it up with GBI concerns.
I've finally gotten around to reading the Genera prospectus, and whilst the multiplexing aspect of the technologies look quite exciting, I do wonder about the IP risk. This was flagged in an article I quoted on early on in the PLT thread, and specifically addressed in the prospectus as follows:-
>>>>>>>>>>>>>>>>>>>>>> Intellectual Property Risk
The success of the Company is signifi cantly affected by the quality of its intellectual property and its ability to obtain and maintain patent and other commercial protection of such intellectual property and to operate without infringing the proprietary rights of third parties, which may be difficult.
Genera therefore faces a number of risks, costs and uncertainties with respect to the patent prosecution process. There is a risk that patent authorities in some or all jurisdictions may refuse to grant a patent to Genera. Furthermore, no assurance can be given that current patents and/or any issued patents will provide a competitive advantage, or that Genera’s competitors will not design around any patents issued.
Also, there is a risk that Genera’s competitors may fi le an objection to Genera’s patent applications, even if that objection is without merit. In this event Genera will incur costs (which may be substantial if litigation is required) in challenging any such objection and as a result, may possibly suffer delays in releasing its products to market, may be required to develop noninfringing technologies or enter into royalty or licensing agreements or may be prevented from releasing its products at all.
While Genera owns a number of patents or patent applications in its own right, it also has a worldwide exclusive licence to key patents from WEHI, and therefore does not currently own these particular licensed patents. Genera’s right to exploit the licensed patents and patent applications to carry out its business may be terminated if Genera breaches the terms of the licence agreements. WEHI has, however, agreed to enter into a formal agreement with Genera in which these patents will be assigned to Genera upon the Company raising $3,000,000 or more by way of share issue. <<<<<<<<<<<<<<<<<<<<<<
As a reminder, the article that flagged this risk (although I don't know anything about the site or author) is at: http://www.egoli.com.au/egoli/egoliStoryPage.asp?PageID={A0780280-36F9-455E-BB5E-04F54024E39B}&Section=FloatFiles
The quote in question:
>>>>>>>>>>>>>>>>> The company noted that key specific risks include the inability to develop commercialisation plans; failure to satisfy regulatory requirements; and intellectual property disputes. <<<<<<<<<<<<<<<<<
Of all of the risks involved in this IPO, this (IP risk) is the one that would concern me the most.
Another concern is cash-flow. They appear to have had $524K in the bank as at the beginning of the year, with $657K in 'Trade and other payables' ($332K trade creditors), plus $1,170K in employee benefits ... if the IPO doesn't get fully subscribed, it would be a bit of a worry.
Whilst I am obviously into PLT in a big way, I am more than a bit curious about this float. If I felt it had a decent chance at achieving its blue-sky potential, I would be tempted to have a crack at it. However, something tells me there are a very large number of 'if's, and also their timeline sounds a little optimistic.
I'd appreciate some feedback on these concerns ... your thoughts?
Cheers.
p.s. besides, so far it's all been gung-ho positive stuff on this forum; it's always good to have someone play devils-advocate and check out the pitfalls ... even if it provides a good opportunity for you guys to smooth over the concerns!
GBI Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
