Thin Film seeks buyer for NFC platform, blaming slow uptake

Norway’s Thin Film Electronics has halted investment in near-field communication (NFC) assets and is looking to license out or sell the business and related intellectual property in the US.

In a statement, the company said that it is “confident in the use of NFC technology for consumer engagement, brand protection and supply chain tracking in the long term, [but] market adoption has been substantially slower than anticipated.”

Preliminary discussions have started between its US subsidiary and potential partners who are interested in its NFC tag manufacturing and CNECT software platform, according to the company.

“Preliminary discussions have been initiated with potential partners who are interested in offering NFC enabled solutions supported by a robust data analytics software platform,” it added.

The announcement came in a press release from Thin Film in the US detailing the closure of a $5.6m equipment term loan facility, with a second $7.6m tranche due to be agreed before the end of the month.

The cash injection is intended to fund operations and a restructuring that is intended to pivot it away from making and selling NFC tags and towards use of its roll-to-roll (R2R) printed dopant polysilicon (PDPS) line in San Jose for other, as yet-unidentified applications, as it tries to reach break-even in its operations.

It’s a switch from the company’s stated strategy earlier this year, when Thin Film said it intended to focus its efforts on driving market adoption of NFC and reduce investment in the San Jose R2R operations to try to deliver $20m in annual savings.

Since then first-half revenues plunged 35 per cent, prompting a second restructuring aimed at saving another $15m and a 50 per cent cut in its workforce. It ended the first-half with just over $8m in cash, and after cancelling a private placement said it needed to raise additional cash in order to continue operating.

Thin Film is already working with partners in various industries such as food and beverage and pharmaceuticals. It has previously negotiated partnerships for NFC with Tapì Group and Bericap for the wine/spirits and over-the-counter (OTC) pharma sectors respectively, and has also been targeting the cosmetics and personal care category.

Deployments of NFC just this year include a project with Martell Cognac, drugmaker Boehringer Ingelheim and haircare company Slikhaar.

The financing round “strengthens our balance sheet and allows us to pursue our aggressive growth strategy to maximize the value of Thin Film’s roll-to-roll production technology and factory and to move toward operating cash flow break even,” said Kevin Barber, group chief executive.