Graphics company wins $14m interest-free loan

The Government will give a local 3D-graphics company a $14 million interest-free loan to keep the major part of its operation in New Zealand.

The forgone interest will cost the Government $3.5 million over three years if the firm - Right Hemisphere - sticks to the loan's conditions.

The move is part of a bid to retain expertise and create a development cluster of companies in the burgeoning global "product graphics management" industry.

Right Hemisphere, which has 55 staff in Auckland and 45 in the United States, develops software to convert technical 3D images into graphics for maintenance and training manuals, and marketing publications.

Touted as a world leader it aims to capture 10 percent of a US$10 billion ($15.47 billion) global market.

Prime Minister Helen Clark said the loan was to help establish and support a world-leading 3D digital content and graphics industry.

"This agreement means that New Zealand brains, talent, and market experience stay in New Zealand."

Included in the terms of the loan was Right Hemisphere contributing to a three-year programme of research projects involving New Zealand universities.

The company's US backers - Sequoia Capital Partners and Sutter Hill Ventures - would also be required to review at least five local tech-firm business plans a year for three years in a bid to get a cluster of companies off the ground.

Helen Clark said it was expected Right Hemisphere's staying in New Zealand would also create benefits for other companies needed to provide support for it.

- NZPA