There are no fees payable by investors in addition to their initial investment. The Company provides for external distribution and intermediary charges of up to 6% of the funds raised. There are no annual ‘fund management’ fees, neither are there any success fees. The management team does not draw salaries either, until the company is revenue-generating and profitable. The management team members are incentivised by their respective equity stakes in the company, and therefore their goal is completely aligned to that of any investor, i.e. a profitable exit upon refinance or sale.
The company is targeted to finish development of the technology suitable for use with Static Generators in 2018. Based on the projections described in the IM, the potential gain for investors in this fundraising Stage is estimated at between 5 and 300 times their initial investment. (See page 36 & 37 of the IM)
The Company intends to licence the developed technology to major: static generator, commercial vehicle (trucks, buses & coaches), and automotive manufacturers. This will take the form of up-front payments, development fees and licence fee per device (vehicle), manufactured. (See page 22 to 32 of the IM for more detail)
Legislation is forcing manufacturers to reduce C02, NOX and particulate emissions in all of their engines, diesel and petrol, and today they do not have the solution. Failure to do so will result in significant fines. (See pages 58 to 64 and pages 77 to 82 of the IM)
Most manufacturers do have large R&D departments and budgets. However, manufacturers are now using external third-parties to help in developing the new technologies required to hit the legislated targets. They recognise that they are not flexible enough, they are not quick enough, and they are not entrepreneurial enough to deliver the solutions required within the timescales allowed by the legislation and its requirements.
Once the EHG technology has been successfully developed and tested on the proposed static generator engine, the Company will be in a position to licence the solution to manufacturers. G-Volution, the licenced JV and development partner will be the first contract, targeted to be 2018. (See pages 12 &13 and pages 65 & 66 of the IM)
Bluebox will be assisting with the development of the VNA turbo-drive to ensure the EHG has enough energy to spin at the required speeds to derive maximum hydrogen output. VNA will retain all IP, knowledge and know-how developed in the agreement.
The Directors plan an Initial Public Offering (IPO) of shares in the Company between 2018 and 2022 at the latest. A trade sale may be considered, as the Directors target will be to derive the maximum possible gain for investors. A third option now available is the use of Asset Match, (see www.assetmatch.com)
Legislation has been put in place by Governments’ around the world in order to reduce C02, NOX and particulate emissions created by Internal Combustion Engines, (ICEs). Both diesel and petrol ICEs are targeted, in particular in the commercial vehicle and automotive markets. Failure to meet the targets will result in significant fines for manufacturers.
The VN Automotive technology solution is a ‘Transition’ technology, in that it will enable the large ICE manufacturers time to develop further enhancements and improvements to the ICE, without the pressure of large fines affecting their profitability and chances of survival in the sector. In this regard the ‘Hybrid’ could be considered a competitor, and so here price will be the key. In another sense the VNA technology is complementary to the ‘Hybrid’, since assuming the technology can be made cost effective enough, it has the potential to be fitted to a ‘Hybrid’ engine, making a ‘Hybrid’ even more efficient and reducing emissions even further. (See pages 80 to 86 of the IM)
Hydrogen is not widely available, nor is it likely to become in the foreseeable future, as cost (both in £ and pollution) of production, distribution, and vested interests will prevent it. (The availability and distribution of LPG demonstrates how long this can take even with vested interest buy-in). Therefore adoption of this solution today will be minimal, as admitted by the parties involved. However, a technology that can produce hydrogen onboard a car, van or truck will accelerate the adoption of Alsets’ solution, and therefore their time to significant revenues.
Today, VN Automotive has the only technology solution that is able to take waste-heat and pressure from an ICE and create hydrogen onboard for co-firing with conventional fuels such as petrol or diesel to reduce the amount of overall fuel required, and commensurately reduce the emissions. (See pages 52-57 of the IM)
The Company intends to develop a solution for the static generator market in the first instance. However, since the engine upon which this solution will be tested will also be used in trucks, VN Automotive is creating 2 potential sales markets for licencing.
The technology has been tested in laboratory and automotive test-bed environments. It has been vetted by UK Trade & Investment industry experts, and laboratory testing was carried out at Intertek Tickford (automotive test facility), under the supervision of Professor Keith Scott of Newcastle University, where energy efficiency and potential scalability have been confirmed. A technical report is in the IM. (See pages 2 to 4 and pages 99 to 114 of the IM)
An investment in the Company is speculative because, although it has access to a substantial amount of research and data which has been compiled regarding the EHG project and has a full IP exploitation licence granted by the IP owner, the EHG has been proven to produce hydrogen in the laboratory and test-cell environments only.
Mitigation –The Company commissioned a report on the energy efficiency and potential scalability of the EHG technology by Professor Keith Scott of Newcastle University, and used Intertek Tickford, an automotive industry-recognised facility, for the measurement and analysis of the outputs from the EHG in the test-bed environment. The data, and the results of the report state that the technology is “97%+ efficient”, which means that it is the most efficient hydrogen producing technology today. Furthermore the report strongly suggests that the output of the technology can be improved significantly. (See pages 2 to 4 and pages 99 to 114 of the IM).
Whilst the engineering being utilised to enable the EHG to be driven by waste energy within an ICE environment is ‘industry standard Turbine Drive technology’ it has not been used to drive an EHG to date. Therefore there is a possibility that the process could not deliver the desired results and the project could fail. Although best endeavour has been used to verify all the scientific research and data the Company is relying on for this project, it may transpire not to be reliable.
Mitigation – VNA has entered into an agreement with Jon McGuire of BlueBox Energy Ltd to develop a solution. John McGuire was a founder and Technical, (R&D) Director of Bowman Technology, a company that develops turbo generator systems that deliver either; more power output or greater efficiency in static generators by using and optimising the exhaust gas pressure and flow. VNA has also signed a licence and JV agreement with G-volution, the industries leading co-firing technology (The mixing of diesel with other fuels, e.g. bio-methane, in existing Trucks to create a more cost effective solution for running Truck fleets), specialist in the Heavy Goods Vehicle sector (See pages 9 to 13 and pages 65 to 76 of the IM).
The market uptake for this type of technology is unproven. Whilst this project is driven by legislation forcing the Automotive Industry by 2020 to reduce emissions by 30% more, and increase fuel efficiency by another 20% from where it is today, there is no guarantee that the EHG will become the industry’s ‘preferred’ solution.
Mitigation – Developing an independently tested solution on an already popular static generator, which is also used in trucks, gives VNA the best chance of success.
Estimates of potential value and costs may not be reliable. The potential licence income values are illustrations only, based on available comparable industry information. These illustrations are subject to market input variables that cannot be determined until the unit is developed and ready for market.
Mitigation – The Directors of VN Automotive have used extremely conservative, industry reference-able figures in the projections and estimations of market penetration and uptake. Furthermore, the Directors have used industry recognised metrics and multiples for valuations and shown how these estimates and projections are put together.
The illustrations of potential income value in this Information Memorandum may, accordingly, not be reliable despite the Directors best efforts to judge them accurately.
Mitigation – The Directors of VN Automotive have used extremely conservative, industry reference-able figures in the projections of income and estimations of market penetration and uptake.
Either put your questions in an email, or request a call from one of the management team to discuss your requirements in more detail.
There are also a number of operating principles embedded in VN projects that make VNA completely different from the competition, namely:
No salaried management team, and no success fees. The team is incentivised on equity position and therefore focused on making the technology as efficient and profitable as possible for the IPO or sale to enable a profitable investor exit
No money management fees, VN Automotive is not a fund neither do the management team act or charge as one
The management team includes individuals with experience of creating, developing and managing small, medium and large companies through to exit
Complete financial transparency on the project, development Opex etc. and on equity distribution and gains at exit.
Download the High Net Worth self-certification form and the VN Automotive investor
application form, fill them in with your investment amount and personal details, sign at the bottom and then either scan and email them to email@example.com, or take photocopies and then send them along with your cheque to VN Capital Partners, 7/10 Chandos Street, London W1G 9DQ.