Gemtech prepares $2m share offer

By ELLEN READ manufacturing writer

Auckland company Gemtech is poised to raise $2 million through a public offer for developing its revolutionary E21 engine.

While the public offer prospectus is nearing completion, the company is understood also to be investigating the possibility of one investor injecting $1 million in return for certain marketing rights.

Discussions on this will be held next month.

If an agreement is reached, Gemtech is likely to reduce its public offer to $1 million.

The E21 was designed by Tony Wondergem, a Dutch immigrant who came to New Zealand in the 1950s. His daughter, Vivienne Wondergem, is a Gemtech director.

The E21 combines two engines in its design, one operating clockwise and the other anticlockwise, so the unit can run at half the speed of other engines while producing twice the horsepower. One benefit is that the E21 is more fuel-efficient and cleaner than conventional engines.

Gemtech has so far spent just under $1.5 million on the engine.

Although capable of automotive, aviation and marine applications, the E21 is expected to be initially marketed as an engine for generators, pumps and compressors.

Gemtech has 120 shareholders and 850 million shares, which last traded at around 5c on the NZSE's unlisted market. But trading was on hold, said managing director Peter Bush, until the prospectus was released.