By Yoke Har Lee
Auckland-based venture capital company Caltech Capital Partners has raised $A3 million ($3.75 million) in financing for Sydney-based Entelec Systems.
The financing came from Nomura Jafco Investments (Asia) and will give Nomura Jafco a 40 per cent stake in Entelec. The additional funding will allow Entelec to pursue an
aggressive expansion growth programme.
Caltech manages Caltech Development Capital Fund which has held a 5 per cent investment in Entelec for the past year.
The tie-up with Nomura Jafco, a large international investment bank and venture group, is seen as a path for Caltech to interest Nomura Jafco in further co-investments in New Zealand companies.
Entelec supplies productivity management software to large manufacturers, focusing on the food and packaging industries. The software monitors real-time production and performance in major production lines.
Douglas Paul, a director at Caltech Capital Partners, said: "We were very keen to be associated with Nomura Jafco as they have a strong manufacturing portfolio worldwide and a significant presence in the US and Asia.
"Their involvement also confirms our initial assessment of Entelec at the early stages a year ago, when we made our investment. We had a very rigorous approach to the investment and Entelec came out very well," Mr Paul said.
Entelec's software and services have been tested around 20 major manufacturing sites, including the confectionery division of Cadbury Schweppes, which piloted the Entelec Systems solution on the automated wrapping process for Time Out bars.
The 24-hour production employs 70 people across three shifts in a continuous process.
The target was to reduce downtime over all shifts by 10 per cent, according to Vince Zappia, business unit manager of Cadbury's confectionery division.
"Using Entelec's system we achieved a 31 per cent reduction in downtime over three months, without the need for capital investment. This equates to an average increase in productivity of 35 minutes per shift," Mr Zappia said.
