Jamie Gray

Jamie Gray is a business reporter for the New Zealand Herald and NZME. news service.

Kiwi software business heads offshore

Right Hemisphere's founder and company chief technical officer Mark Thomas.
The 3D graphics software company has been sold to German software giant, SAP Ag.
File photo
Right Hemisphere's founder and company chief technical officer Mark Thomas. The 3D graphics software company has been sold to German software giant, SAP Ag. File photo

Right Hemisphere, an Auckland-based 3D graphics software developer and recipient of an US$8 million soft loan from the government, has been sold to German software giant, SAP Ag, for an undisclosed sum.

SAP, which is based in Walldorf, Baden-Wrttemberg, has bought all of Right Hemisphere's products and relevant assets, including 3D visualisation and publishing technologies.

Right Hemisphere, which also has a presence in San Ramon, California, was founded by its current chief technical officer, Mark Thomas.

SAP said 3-D model-based visualisation and communications technologies from Right Hemisphere will enhance SAP's software solutions.

"This acquisition is consistent with SAP's strategy to complement existing applications and solutions with innovative technologies and capabilities while maintaining its successful track record of organic growth," the company said.

SAP intends to integrate the enterprise visualisation technology assets from Right Hemisphere into its mobile technologies, allowing business users to access timely visual images of products on a variety of mobile devices.

"Employees will be able to make process and procedural adjustments on the fly, and sales and customer relations teams will be able to provide their customers with a photo-realistic visualisation of the final product from any location, allowing them to give feedback before the product is delivered," SAP said.

Right Hemisphere was once touted by the Helen Clark-led Labour Government as a potential New Zealand success story, and had won some key contracts with big clients in the United States since it was founded by Thomas more than a decade ago.

The New Zealand arm of the company, which provides research and development services to its American office, made a pre-tax profit of just under $700,000 in the year to March, 2010.

The decision in 2006 by then-Economic Development Minister Trevor Mallard to give the company a five-year interest-free loan of what was then $14 million went ahead despite Treasury advice that it had "a low probability of resulting in net benefit to New Zealand".

At the time, Clark said the aim of the loan was to help establish and support a world-leading 3D digital content and graphics industry.

As part of the deal, Right Hemisphere was to develop a cluster of spinoff companies in which its American backers, US venture capital firms Sequoia and Sutter Hill, were also expected to invest.

Right Hemisphere spokesman Stephen Knightly said the company would soon repay its loan from the government.

"The plan is that it will be repaid when the transaction goes through," he told APNZ.

He declined to comment on who, aside from Thomas, owned the company.

"All I can say is that it was a privately held company".

He also declined to give a ballpark estimate as to the size of the deal, other than to say it was "significant".

- APNZ

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