Tech firm seeks serious capital for car-making

By FIONA ROTHERHAM

Blue-sky technology firm Indranet is looking to raise $50 million to commercialise its top-secret computer and communications network and build a Christchurch car-making plant.

Indranet, which floated on the Stock Exchange's secondary board last year, has hired Deloitte Touche Tohmatsu for financial advice on fundraising.

It needs between $10 million and $15 million to build the Christchurch plant next year to make zero-emission, compressed-air vehicles developed by French firm Motor Development International (MDI).

Indranet paid F1.5 million ($466,000) for the rights to manufacture the compressed-air cars at three factories in Australia and New Zealand over 20 years.

MDI supplies the modular factories.

Indranet hopes to adapt its revolutionary technology for traffic management use in the vehicles. MDI has yet to sanction this.

The car-making operation will be run by wholly owned Indranet subsidiary ZenIT, which will eventually be spun off as a separate listed entity.

Indranet was set up by co-inventors Louis Arnoux and Andrew McGregor in 1998 with the aim of establishing ultrahigh-frequency wireless communications technology.

It raised $3 million in a share float early last year, attracting 1270 shareholders in New Zealand and Australia. More recently it has raised a further $1 million through a private placement with overseas investors.

A decision on new fundraising is likely to be made within three months. It hopes to raise $20 million in New Zealand.

Director Mick Kain said options included another public float, more private placements with individuals or finding industrial partners.

"The big job for Deloitte's is to find partners to apply our core technology out in the field."

Considerable scepticism remains levelled at the Christchurch company's technology.

Mr Kain admits the link with the compressed-air car gives it much-needed credibility with investors.

MDI's prototype, designed by former Formula One racing engineer Guy Negre at Brignoles in France, received widespread media coverage.

The connection with Indranet came about because Mr Arnoux was raised in a neighbouring village.

Initially the vehicle is being developed as a lightweight taxi but it can easily be converted for private use.

Electricity is used to produce the compressed air the cars run on. They cruise at 50 to 60 km/h, but also run at higher speeds on fuel.

The Mexican Government is understood to have placed the first commercial order, for 40,000 cars to replace taxis in polluted Mexico City.