Scott Tech takes major stake in electromagnet maker

Minimising resistance and so energy loss when transmitting electricity is one of the aims of the burgeoning superconductor industry. Photo / Mark Mitchell

Dunedin-based Scott Technology has taken a $4.4 million controlling stake in a commercial offshoot of a Crown Research Institute.

Scott Technology announced yesterday that it was buying 50.65 per cent of HTS-110, a company which designs and makes electromagnets using superconductors.

Superconductors allow electricity to pass through them with no resistance, improving energy efficiency.

Scott Technology's managing director, Chris Hopkins, said HTS-110 met all the criteria for investment. "It's high technology, world-leading, New Zealand-based, it typifies what Scott is about."

Scott Technology designs a range of machines, including products which build and assemble household appliances such as ovens and fridges.

Of particular interest to Scott Technology are HTS-110's magnets which can be used by mining, gas and oil companies to analyse materials.

This technology also appears in magnetic resonance imaging (MRI) machines, used by the health sector to produce detailed scans of a patient's body.

"They have some key technologies which are on the fringes of [being released commercially] so we're looking to drive that process," said Hopkins.

HTS-110 is an associate company of Industrial Research Limited (IRL), a Government-owned research centre which aims to support the manufacturing and industrial sectors.

"There's a lot of talk that companies like IRL, as a Crown Research Institute (CRI), should sell off their interests before [taking products to the market]," he said.

Hopkins said private-sector companies could do more with these products than firms tied to Government researchers and more businesses should take advantage of developments coming out of CRIs.

"We see it as a way of unlocking technology caught up in a research and development environment and pull it out into a commercial world," he said.

Since 2004, HTS-110 has been jointly owned by IRL, Endeavour Capital and the American Superconductor Corporation (AMSC). In the takeover, Endeavour Capital sold its stake to Scott Technology and IRL and AMSC diluted their shares.

Scott Technology shares were up 3c at $1.45 during trading yesterday.