The case is about an Israeli company which has just lunched a new product.
Infinity is currently involved in acquiring a majority and control interest in an Israeli company that is set to be a world leader in the design and manufacturing of revolutionary flat‑panel X-ray detectors based on the company’s proprietary technologies for medical, industrial and security applications. The company’s detectors have already demonstrated superior X-ray sensitivity compared to other known imaging sensors. The Company plans to develop, manufacture and sell products primarily for the health-care but also for non-destructive testing (NDT), Homeland security and other industrial market segments. The company's products meet the needs of the digital X-ray imaging market by offering cost‑effective detectors that enable data acquisition at up to 120 frames per second, delivering image quality with edge-to-edge clarity, bringing efficiency, increased resolution, reduced radiation and clinical performance capabilities across the full range of imaging applications.
1. The Company
The X-ray detectors company is focusing on the global direct digital X-ray market, and is specializing in developing proprietary semiconductor detectors targeted at the health care, nondestructive testing and other industrial market segments. Real-Time Radiography’s technology is based on patented X-ray detectors whose active and distinguishing component is a mercuric iodide semiconductor-based X-ray photoconductor. Electronic signals recorded in the mercuric iodide are read out using commercially available thin film transistor (TFT) arrays. These proprietary detectors boast the highest X-ray sensitivity known in the industry along with the ability to be manufactured at low cost. The X-ray Company is well positioned to be the sole supplier of the next generation digital radiographic imaging products.
The Company objectives are to:
· Establish its revolutionary technology as the gold standard for all direct, digital X-ray market applications;
· Respond to unique demands to which existing major players in the imaging modalities industry have been incapable of responding.
· Extend its commercial coverage in order to build up OEM sales in growth markets, including Europe, North America and the Pacific Rim;
· Work with partners to obtain enabling capabilities and financial success.
2. MARKETING AND SALES ACTIVITES
X-ray Company plans to provide X-ray equipment manufacturers and system integrators, on an OEM basis, with turnkey image acquisition subsystems that these customers can integrate into their system offerings. These image acquisition systems will produce digital X-ray images in a standard image file format and software for reading out the images. Customers will compete with each other by providing differentiating image manipulation and computer aided diagnosis (CAD) software and by providing a unique system product offering.
Because of the OEM strategy, the limited number of X-ray equipment manufacturers, and the technical nature of the “factory-to-factory” sales, only a small marketing force is needed to penetrate the very large and lucrative market.
The key to The X-ray Company success will be to fulfill its technical goal of providing the highest quality, lowest cost Direct Digital X-ray detector.
3, PRODUCT RESEARCH AND DEVELOPMENT
Based on its proprietary technology, backed by a very strong IP position, X-ray Company has demonstrated diagnostic quality images for 4” X 4” TFT arrays, and is in the process of scaling up the technology for market-required formats. It has currently built and shipped the first 8” X 10” array for evaluation. The ultimate size will be 17” X 17” for the “film replacement” in General Radiography market, and 10”x10” Radiographic and fluoroscopic dynamic detector for Cardiac, Peripheral Vascular and Gastro intestinal applications.
Based on its proprietary technology, backed by a very strong IP position, X-ray Company has demonstrated diagnostic quality images for 4” X 4” TFT arrays, and is in the process of scaling up the technology for market-required formats. It has currently built and shipped the first 8” X 10” array for evaluation. The ultimate size will be 17” X 17” for the “film replacement” in General Radiography market, and 10”x10” Radiographic and fluoroscopic dynamic detector for Cardiac, Peripheral Vascular and Gastro intestinal applications.
Based on its proprietary technology, backed by a very strong IP position, X-ray Company has demonstrated diagnostic quality images for 4” X 4” TFT arrays, and is in the process of scaling up the technology for market-required formats. It has currently built and shipped the first 8” X 10” array for evaluation. The ultimate size will be 17” X 17” for the “film replacement” in General Radiography market, and 10”x10” Radiographic and fluoroscopic dynamic detector for Cardiac, Peripheral Vascular and Gastro intestinal applications.
The company had just completed the following
• Complete coating process for 8”x8” arrays for a potential OEM customer and start scaling up to 17”x17”.
• Built 4”x4” prototype imaging system to enable evaluation by potential OEM customers
• Design and built its own 17”x17” dynamic detector at a reasonable cost
Please answer the following Questions;
1. what are your thoughts regarding the fund strategy
2. Knowing the fund strategy would you recommend the fund to consider Investing in the X-ray company describe here?
3. If you responded yes (for Q1) which steps you will recommend the Fund to make in order to proceed with its investment?
4. Please describe the pros and cons for the investment from the fund point of view and from the Chinese partner point of view.
5. What other information would you look for in order to improve your future decisions?
6. Who you think will be the best Chinese strategic partner for such deal and how you were convincing him to invest and partner in the X-ray company?
