Tuesday 1st October 2019
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Futuristic textile company StretchSense has been sold to a new Kiwi owner, the firm’s administrators say.
In July the shareholders of the company, which makes the futuristic ZoZo suit, appointed Baker Tilly Staples Rodway’s Tony Maginness and Kevin Pitfield as administrators.
Maginness says an unconditional agreement to sell the business has been signed and the new owner will take over next week.
The administrator would not be drawn on who bought the company or how much was paid, saying their identity would become public after settlement.
StretchSense was spun out of The University of Auckland. Its fabrics were promoted as the 'third-generation' of wearables in which soft sensors and electronics were integrated into garments for the sports, health and virtual reality sector.
The new company will continue to invest in research and development and “will continue the company’s mission to create the world’s best stretchy deformation sensors and motion capture gloves,” Maginness said.
Director and founder Ben O’Brien will work for the new owners, he added.
The company was moved into administration when “they hadn’t run out of cash, but they knew they were going to and required some restructuring,” Maginness said. There were 30 staff at the time of appointment, but employee numbers and overheads had been reduced as part of the administration process, he said. The company will remain based in Penrose after signing a new lease in the same building.
“They will go on to bigger and better things and they are smart guys and it's good technology,” Maginness added.
The business had been awarded $15 million in Callaghan Innovation grants and was backed by a government investment fund.
It had also received investment from Japanese retailer StartToday - now ZoZo - in 2016.
In November 2017, StretchSense signed a US$20 million deal with StartToday, which would have allowed the retailer to increase its stake from 40 percent to full ownership.
However, the transaction was called off last year.
It was reported in May last year that the deal's collapse meant 145 of 180 staff were laid off.
The firm had secured investment from Ralf Muller, Auckland UniServices, Flying Kiwi Angels and the New Zealand Venture Investment Fund. Amounts aren't clear but the university entity holds a 4.5 per cent stake while NZVIF holds 5.84 per cent.
According to its website, StretchSense had more than 300 companies in more than 28 countries prototyping products with its sensor technology. It was awarded an annual $5 million over three years in Callaghan Innovation funding, from the start of 2017.
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