UNIVERSITY of Western Australia offshoot Vitrostone has experienced a significant setback in its commercialisation process, revealing that it is confronting issues related to its technology and cash-flow problems.
UNIVERSITY of Western Australia offshoot Vitrostone has experienced a significant setback in its commercialisation process, revealing that it is confronting issues related to its technology and cash-flow problems.
While the research and development team remains intact, three senior managers, including Raffaele Cammarano, Graham Woolford and Nicholas Day, were made redundant last month as the company works to resolve the problems and assess its position.
Vitrostone director Dr Andy Sierakowski, who is also head of UWA’s Office of Industry and Innovation, confirmed there were problems but remained confident after a positive board meeting this week.
“We have a tight cash position,” Dr Sierakowski said.
“We have had a quality problem with the technology; we have currently got very good tests and we believe that we will resolve the quality problems.”
He said Vitrostone was in negotiations with suppliers for other Vitrostone products and the company remained confident it would resume production and indicated there was “significant interest” from overseas companies in the company’s product range.
“This product, the pavers, is only one of several other Vitrostone products,” he told WA Business News. “Vitrostone is an R&D licensing company for building products. The pavers are just one of those products.”
Dr Sierakowski said the company was holding independent, National Association of Testing Authorities (NATA) accredited testing of the pavers to “assure ourselves that we can go back into production”.
“Unfortunately we had to let people go. We’ll be back, but with a modified team,” he said.
Vitrostone produces innovative building products and was formed out of another UWA offshoot and nanotechnology developer, Advanced Power Technology, which started life as a research project at UWA in 1997 and now produces three branded nanoproducts – ZinClear, Alusion and NanoZ.
APT and Vitrostone, which have had close financial links – secured $2 million each from the WA Local Government Superannuation Fund in November 2002.
The fund’s chairman, Alex Bajada, said $1.5 million of the $2 million of committed funds had been invested in Vitrostone to date, with the remaining $500,000 subject to the meeting of milestones.
ASIC records show Vitrostone issued 2,000,000 10 per cent convertible notes for $1 million on December 17 2002.
A further $500,000 of subscription funds was received, subject to the company reaching its first milestones, which ASIC records show included: having developed the manufacturing capacity for pavers and castable products; having achieved sales of the products; and having reached agreement for additional equity participation with an organisation involved in the building/construction industry.
Mr Bajada said the second instalment of $500,000 had not yet been paid to Vitrostone and was subject to further milestones.
ASIC documents indicate these milestones include “the company having developed its foamstone product to a commercial standard”.
Mr Bajada said he was aware of issues with the paving product but remained unconcerned.
“I understand that they have this under control,” he said.
