Transense Technologies PLC, the provider of sensor systems for the industrial, mining and transportation markets, recently announced an extension to its joint collaboration agreement (JCA) with mining tyres giant Bridgestone Corporation in Japan. On 13 August 2019, Transense announced that it had entered into the agreement, by which Bridgestone offers the Translogik iTrack TPMS system exclusively as a mining tyre monitoring system for tyres 57 in and above for its off-the-road (OTR) customers. Transense says customer reaction to the JCA has been very positive, indicating scope to increase iTrack adoption significantly in the second half of the year and beyond.

The agreement was for an initial 18 month period with ability to extend. Under the agreement, Transense undertook, inter alia, that it would not for a period of six months have discussions with any other party in relation to any transaction of a merger, acquisition or joint venture nature in respect of its iTrack business. On 12 February 2020, Transense and Bridgestone agreed to extend the duration of the Agreement until 12 February 2022 at the earliest, and extend the period during which Transense undertakes not to have discussions with other parties until 30 April 2020.

In a more detailed discussion of the cooperation in its interim results released 20 February, Transense stated: “Under the JCA, Bridgestone has agreed to offer the iTrack system exclusively as a mining tyre monitoring system for the largest mine haul trucks, and the company has agreed that it will not contract with any other tyre manufacturer for this category of tyres. Since the commencement of the JCA, Bridgestone affiliate agreements have been signed in many key territories, facilitating pre-sales engagement with major clients worldwide. This activity has produced sales opportunities at an unprecedented level, and many new trials are underway. The typical sales cycle in this marketplace extends for a number of months prior to adoption, and accordingly the JCA has not yet generated significant subscription income. There are considerable costs associated with the generation of client engagement, however, including building our sales, customer support and technical teams, opening a new London office to co-ordinate these activities, and extensive overseas travel. These additional costs have been part funded by direct support and loans from Bridgestone under the terms of the JCA, and the impact on reported earnings in the current period was approximately £0.40m.”