Message from Andrew: Commercial Cladding by 2012
The R&D100 is a worldwide competition, and CermaClad beat out the top new product offerings of numerous Fortune 100 companies and major institutions.
As a result of our continued successes and validation, support is snowballing from investors, the state of Ohio, federal agencies, and customers. This support will allow us to move forward even more aggressively to bring these exciting technologies to market over the next few quarters.
So far this year we have executed an exclusive technology access and supply agreement with Mattson Technology, the world’s premier manufacturer of high intensity arc-lamp systems, and have also signed a Cooperative Research and Development Agreement (CRADA) with Oak Ridge National Lab. We have also entered into a partnership with the Houston Technology Center, and have formed a cooperative agreement with leading oil company Petrobras, among other partnerships.
At the beginning of 2011, we had just one facility and a few labs, but by the end of this year we will have a total of four facilities, including a newly-leased 10,000 square foot facility in Eastlake, Ohio; an additional developmental and testing facility in Akron, Ohio; and a brand new, purpose-designed 11,000 sq ft manufacturing plant in Euclid, Ohio.
We have also hired more than ten new employees this year, including our new Quality Manager.
All of these positive developments will enable us to accelerate the commercial introduction of our breakthrough CermaClad and PComP coating solutions that will become market leaders in reducing corrosion and wear costs and liabilities around the globe.
Andrew Sherman, CEO, Mesocoat Inc.
Abakan Investment to Accelerate Commercialization
Abakan Inc. has now fully exercised its option under a phased investment agreement and purchased a controlling interest in MesoCoat, Inc. This continued and robust investor support is essential to the rapid commercialization of our groundbreaking technologies.
“Abakan is very excited about expanding MesoCoat’s next-generation corrosion- and wear-related market solutions to commercial applications,” says Abakan CEO Robert Miller. “As we advance toward the full commercial introduction of these solutions, test results from prospective clients have confirmed the compelling nature of MesoCoat’s value propositions with some of the top players in several multi-billion dollar industrial segments worldwide.”
“This continued financial support is a key component that will allow MesoCoat to complete important Stage II commercialization milestones,” adds MesoCoat CEO Andrew Sherman. “These milestones include adding production capacity and equipment to support market introduction of PComP™ and CermaClad™ solutions with our initial committed end users.”
CermaClad™ Wins 2011 R&D 100 Award
MesoCoat has been notified that we have won an R&D 100 award, and in an October ceremony we will accept this “Oscar of Innovation” for our CermaClad™ products. These awards recognize the top industrial innovations that are ready to be commercially introduced, and MesoCoat is proud to receive this prestigious recognition.
CermaClad™ is a high-performance, highly productive fusion cladding process that imparts exceptional resistance to corrosion, wear, and erosion to pipes, plates, and components in multiple industries. The process rapidly and cost-effectively applies and fuses 0.1 to 15 mm thick, metallurgically bonded metal and cermet claddings to the surface of lower-cost metals and alloys.
MesoCoat holds an exclusive license to the technology originally developed at Oak Ridge National Laboratory, and has partnered with NASA Glenn Research Center, Mattson Technology, Inc., Oak Ridge National Laboratory, Petrobras, and Ohio’s Edison Materials Technology Center to further develop and transition the CermaClad technology. Expected to be ready for market entry by the end of the year, CermaClad is 10 to 100 times more productive than competing weld overlay or laser cladding alternatives, while providing superior corrosion and wear performance at lower cost.
Exclusive High Intensity Arc Lamps for Commercial Cladding
MesoCoat and Mattson Technology, Inc. (MTSN, NASDAQ) have entered into a mutually exclusive joint development agreement and supply partnership to customize, manufacture, and supply Mattson’s Vortek™ high-intensity arc lamp systems for the metal coating and cladding segments served by MesoCoat. This multiyear agreement is potentially worth over $50M across its seven-year term. It represents an extension by Mattson into the metal coating and cladding marketplace for its Vortek arc-lamp technology, and assures access and supply of these incredibly powerful, high intensity sources for MesoCoat and its client customers.
Under the agreement, Mattson and MesoCoat jointly designed and developed a 500 kW cladding head designed to operate inside 12 m long pipe lengths down to 8 inches outer diameter, and we are excited to move to the initial clad pipe production stage.
MesoCoat also placed a multimillion dollar order for custom engineering and delivery of its first two 500 kW Vortek arc lamp systems, which will be integrated into the new building in Euclid, Ohio. Delivery is expected in late 2011 for these extremely high productivity cladding systems.
New Cladding and Coating Facility
MesoCoat has leased a new 10,000 sq. ft. facility in Eastlake, Ohio. It is designed to accommodate two component manufacturing lines for CermaClad, and thermal spray coating cells for PComP, as well as a metallurgical and analytical lab.
A 600 kW Vortek™ arc lamp system, one of the most powerful arc lamp system ever manufactured, and a robot controller are to be delivered sometime in late August or early September. The Eastlake facility will support Mesocoat’s component manufacturing and remanufacturing business lines, offering metallurgically bonded wear- and corrosion-resistant claddings, as well as PComP™ nanocomposite thermal spray wear- and corrosion-resistant coatings. It will also support stripping, machining, grinding, and dimensional inspection equipment to enable entry into the industrial machinery and equipment market.
Strategic Partnership with Houston Technology Center
Because of MesoCoat’s primary focus on the Oil and Gas industry, we have entered into a strategic partnership with the Houston Technology Center, named by Forbes as one of “Ten Technology Incubators Changing the World.”
Our involvement began in early 2010, when MesoCoat engineers presented at an HTC event in Houston. Since then, MesoCoat has been actively working with them and recently became a member of the HTC Energy Acceleration Group, which provides strategic and tactical management advice to emerging energy technology companies. Its seasoned executives work closely with the major energy companies, entrepreneurs, and investors to foster the growth of these businesses.
Now they are helping us to introduce our company to their vast network, which includes top executives from Fortune 500 companies and the Oil and Gas value chain. MesoCoat is proud to have been elected and confirmed as a HTC acceleration client. We look forward to working with HTC to aggressively expand our Houston and Gulf Coast presence, and to deploy our revolutionary PComP nanocomposite cermet and CermaClad large-area fusion cladding solutions.
MesoCoat currently has a Houston sales office, and we have formed partnerships with thermal spray service providers to rapidly deploy our technology into the marketplace. As acceptance grows beyond the capacity of current delivery partners, MesoCoat intends to acquire, invest in, or build additional manufacturing facilities and capacity in the Gulf Coast region for both PComP and CermaClad product lines.
Oak Ridge CRADA to Develop Breakthrough Amorphous Coatings
MesoCoat has signed a Cooperative Research and Development Agreement (CRADA) with its long-term strategic partner and licensor, Oak Ridge National Laboratory. Under this CRADA, Oak Ridge and MesoCoat will jointly develop, test, and qualify next-generation Structural Amorphous Materials (SAM) coating and cladding materials for extreme wear and abrasive applications.
Greg Engleman, CTO of MesoCoat Inc., and former Oak Ridge employee stated, “I am happy to be working with my former colleagues from ORNL again. This new class of nano-composite materials will provide improved life over current chrome carbide materials at a fraction of the cost of current tungsten carbide solutions.”
Susan Shellhouse, New Quality Manager
MesoCoat has hired Susan Shellhouse as Quality Manager. She has over 20 years of experience in the Quality domain, specifically at materials science companies, and brings knowledge and skills that can accelerate our Quality Control and Qualification process.
Prior to joining MesoCoat, Susan worked for Fortune 500 companies such as General Electric and British Petroleum, as well as large corporations such as Northern Technologies International Corporation.
Susan’s goals for the year include achieving ISO and work towards API, AS 9100, and NADCAP accreditation for our facilities, as well as supporting Quality programs and training for rapid growth. Along with her counterpart Sharon Redman-Blom, who was recently hired as the Human Resources Manager, Susan will play an integral role in achieving seamless growth and integration of new people and production facilities over the coming years.
A number of statements contained in this publication are forward-looking statements. These forward-looking statements involve a number of risks and uncertainties including technological obsolescence, market acceptance of future products, competitive market conditions, and the sufficiency of capital resources. The actual results MesoCoat and Abakan may achieve could differ materially from any forward-looking statements due to such risks and uncertainties. MesoCoat and Abakan encourages the public to read the information provided here in conjunction with its most recent filings on Form 8-K, Form 10-K and Form 10-Q. Abakanís public filings may be viewed at www.sec.gov.