NextWindow was approved for $8.2 million in technology development and student funding grants, of which it drew down $2.6 million and $1.3 million respectively.
The now-defunct Ministry of Science and Innovation defended its 2011 decision to award $5.9 million in grants after Smart's takeover, saying NextWindow's intellectual property remained in the country and other criteria had been met.
Callaghan manager grants and risk assurance Ross Baker said in a statement the agency found it wouldn't be able to claw back any funds from the technology developments grants (TDGs), which have since been replaced with new subsidies.
"Due to the lack of any underlying asset value within NextWindow [the technology upon which their products were built had become rapidly obsolete resulting in the loss of two primary customers] it was determined that seeking repayment of funds from the company was not commercially viable," Baker said.
Smart wrote off all of the goodwill attached to the loss-making NextWindow, worth US$34.2 million, in the 2013 financial year, and has incurred US$33.2 million of restructuring costs over the past three years including US$21 million of inventory write-offs in 2013 and the mothballing of a plant in Ottawa.
The company, best known for its Smart interactive whiteboard, is pinning its future on finding new ways to make money from the education whiteboard market and branching into new enterprise services.
Smart bought NextWindow in April 2010 for US$82 million.
