BluGlass (ASX:BLG) new collaboration partner and technical breakthroughs


by Jessica Amir

BluGlass Limited (ASX:BLG) Managing Director, Giles Bourne talks about the company's continuing strategy for taking its patented RPCVD epitaxy technology for high-brightness LEDs, microLEDs and power electronics to market, its collaborations and breakthrough.

Jessica Amir:
Hello I’m Jessica Amir for the Finance News Network. Joining me today from BluGlass Limited (ASX:BLG) is Managing Director, Giles Bourne. Hi Giles, Happy New Year and welcome back.

Giles Bourne: Thank you Jessica, good to be back.

Jessica Amir: First up, you’ve made significant inroads on your strategy and you’ve also made several announcements. One of those was a collaboration with a company called Aixtron (ETR:AIXA). Just tell us who they are and the significance of the announcement?

Giles Bourne: Aixtron are one of the two leading semi-conductor equipment manufacturers, in this compound semi-conductor space. They’re based out of Germany, a listed company, we’ve known them for a number of years. We’re working with them now in a collaboration, which is to largely support of our ongoing development of new equipment. But ultimately, we’re looking at machine manufacturers. Our business is one about licensing the technology.

In order to enable that licensing, we’re looking at retrofitting existing installed MOCVD base and actually incorporating RPCVD technology, into new machines. And this is really where Aixtron come into play later down the track. They do have a strong R&D focus. So we think they’re the right partner for us, both in the short-term and the longer-term, when it comes to rolling out scale in terms of manufacturing.

Jessica Amir: What’s the purpose of the collaboration and what will ultimately its success mean for BluGlass?

Giles Bourne: The purpose of the collaboration is initially to support the development of new equipment. So we bought two new machines, which are both Aixtron machines. One is a G4 platform, which is one that’s widely used through the industry and the other one is a slightly older machine, which is going to give us a lot more capacity. As we turn those machines into RPCVD, we need support with both the software and hardware. So this is really where the initial collaboration comes into play, it’s really supporting that.

But they also are evaluating our RPCVD for their own use. But later down the track, we’re looking obviously as I’ve said earlier, about rolling this out into manufacturing and we need a manufacturing partner to do that. So that’s something if successful, we’ll be looking at.

Jessica Amir: There’s been a change with your biggest shareholding. Just tell us about that?

Giles Bourne: We’ve had SPT Technologies as a major cornerstone investor of BluGlass, for quite sometime. The circumstance of their business haschanged, in such that they are refocusing on what they’re doing and they’re a very diverse business. But they see the economic value in BluGlass. So they’re actually selling their shares to a company called, Lanstead. They’re a well-known technology investor investing into small and midcap, with growth companies.

So the structured deal that they’ve put in place, allows Lanstead to capitalise on our development. But at the same time, SPT can capitalise on the economic benefit that BluGlass has. So they’ve structured this over a period of time. We see Lanstead as a good supportive shareholder to have on our register, and we look forward to working closely with them in the future.

Jessica Amir: At the end of the calendar year 2018, you announced a very exciting breakthrough, tunnel junctions. Just tell us what it actually is and why it’s so important for the industry?

Giles Bourne: Essentially a tunnel junction is a building block for a more efficient LED. So to make a tunnel junction, it’s very very difficult to do. RPCVD has some natural advantages in terms of making that tunnel junction. And on top of that, you can do what is called a cascade LED. Essentially what that means is a smaller more efficient LED, which is absolutely vital to the industry and it’s something to be widely talked about. One of the biggest challenges the industry has at the moment is called the efficiency droop. And the efficiency droop means that when you apply more current to an LED, it doesn’t equate to more light output, the light output drifts away. And that’s problematic to the industry.

As you apply these LEDs to more and more high-end applications, like automotive, or industrial lighting, architectural lighting, they need to be brighter and more powerful generally. But real estate becomes a premium with LEDs, you can’t have LEDs being bigger and bigger. You have to have smaller and smaller LEDs more powerful. So the tunnel junction and these cascade LEDs is one way of solving that.

Jessica Amir: What’s next in making this a commercial reality?

Giles Bourne: So we’ve already received interest from the industry, on our tunnel junctions. For us there still is an element of R&D that we have to do, but we’ve progressed it quite a long way, that we’re getting some really interesting data. So we’ll be sharing that data with the industry. We’ve now published that we’re working on tunnel junctions. And given the level of interest in the industry around the whole tunnel junction cascade LED, we do expect this to turn out to some really interesting dialogue.

Our CTO, Ian Mann, will be presenting our data at a key conference in February, in San Francisco, where he’ll be able to share the data on tunnel junction, actually discuss that with the industry. But again, it comes back to our strategy, which is about licensing this process off. And so, we will be looking to licence out the tunnel junction technology.

Jessica Amir: You’ve had a very busy first half. So what can investors expect this calendar year?

Giles Bourne: We’re very much going down the path that we said we would do. Namely, upgrading our facilities, so that has well and truly progressed. That's two tools that we have added to our facilities. So it’ll take us to a total of five tools. So that’s four RCPVD and one MOCVD tool, when the facility is fully up and running.

All of this is going to drive more IP, more patents and trademarks. And to help do that, we’ve recruited four people to our research team to help drive the technology forward. Obviously we have our continuing collaboration partners that we’re working with. And we’ll be looking to get new collaboration partners on board, as we have more bandwidth within the business. Clearly the tunnel junction project is really important for us, as is the MicroLEDs, but there are other interesting opportunities.

We constantly get asked about how we could apply our RCPVD technology. And a lot of the time, we’re unable to pursue those paths, because we just don’t have the resources. The additional facilities and resources we have on board is going to help us pursue other avenues, but obviously focusing on the ones that are most commercially significant for the company, in the short-term. And BluGlass will continue to work closely with Lumileds, trying to negotiate a good commercial outcome. So that’s ongoing for the company.

And then we have this Epitaxy business, customer service business as we call it, which is generating revenue for BluGlass. With the new tools coming online, we expect that business to grow as well, so we’re putting effort into that. That also generates new IP, new ideas and new ultimately, commercialisation opportunities for the business.

The whole commercialisation piece, we’re working closely with both domestic and international advisers, to help steer the strategy for the company. As you well know, most of our future customers and our current customers are all offshore. So we work closely with well-known industry expert and advisers, to help steer the strategy for the company.

So lots on our plate for the calendar year 2019, but exciting times for the company.

Jessica Amir: We’re looking forward to seeing you grow. Thank you so much Giles Bourne.

Giles Bourne: Thank you Jessica.


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