Nanotechnology company Meta Materials Inc. (MMAT:NASDAQ; MMAX:CSE; MMAT:FSE) announced it has hired a top international expert to head its new business unit for banknote anti-counterfeiting and authentication.
Alan Newman of London-based De La Rue Plc has been appointed chief product officer for Authentication and managing director of the Banknote and Authentication business unit for META, the company said.
Newman was head of design at De La Rue, which started as a printer more than two centuries ago and is now the "world's largest commercial banknote printer," according to its website. Under Newman's leadership, De La Rue's design team has created more than 600 banknote designs worldwide and won more than 14 international design awards since 2008, META said.
"His acumen in driving innovation and his relentless pursuit of excellence have been instrumental in maintaining De La Rue's undisputed status as the paragon of banknote design," META said in a release.
Developed first in the 1960s, design and manufacturing capabilities caught up to metamaterials in the 2000s.
"We believe Meta's solutions have the potential to disrupt various end markets," Alliance Global Partners analyst Jake Sekelsky wrote.
META is using them to develop nanotechnology products like self-deicing and defogging enclosures for automotive advanced driver assistance systems (ADAS), see-through antennas, augmented reality glasses that look like regular glasses, and special eyewear that protects pilots' eyes from laser strikes.
"We believe META is well-positioned to secure partnerships with major companies over the next year," Alliance Global Partners analyst Jake Sekelsky wrote about META in a research note. He has rated the stock a Buy with a US$2 per share target price.
"We believe Meta's solutions have the potential to disrupt various end markets," he wrote.
The Catalyst: New Era for Banknote, Brand Authentication
META is applying its futuristic technology to the communications, health and wellness, aerospace, automotive, and clean energy sectors.
The majority of its revenue currently comes from a contract with an unspecified G10 central bank customer for anti-counterfeiting measures for their banknotes.
A new purchase order earlier this year brought the amount received by META to US$14.4 million so far. It is part of an agreement with the bank for a maximum of US$41.5 million in orders over up to five years. The customer can increase the scope of the award.
"By making OEMs' products smaller, safer, more efficient, and functional, we believe Meta is well-positioned to secure partnerships with major companies over the next year," Sekelsky of Alliance Global Partners wrote.
META's KolourOptik® technology can include images with omnidirectional movement, 3D depth, or holographic security patterns on not just currency but on documents, smart packaging, and gift cards. The technology can also help prevent loss of life due to counterfeit medication.
"META is at the vanguard of innovation, particularly with its nano-optic technology," Newman said. "The potential for applying these advanced materials to usher in a new era for banknote and brand authentication is both exciting and boundless."
Newman said he hoped to use his knowledge of design, manufacturing, and commercialization to "redefine industry standards" and "contribute to the growth of META's other burgeoning domains."
The company said it is planning the general launch of KolourOptik® sometime this year.
"By making OEMs' products smaller, safer, more efficient, and functional, we believe Meta is well-positioned to secure partnerships with major companies over the next year," Sekelsky of Alliance Global Partners wrote.
'A Potentially Stable Business' With 'Sticky Customers'
Fake goods, currency, and documents are an expensive problem worldwide. The total value of imported fake goods was about US$509 billion in 2016, or about 3.3% of global trade, according to a 2019 OECD report.
META said the security printing market is valued at US$29.8 billion and is growing.
"The proliferation of fraudulent operations around the world and the usage of counterfeit money in industries like banking, gaming, and retail are the main drivers of this market's expansion," Adroit Market Research said.
"The proliferation of fraudulent operations around the world and the usage of counterfeit money in industries like banking, gaming, and retail are the main drivers of this market's expansion," Adroit Market Research said about the counterfeit money detection market that has sprung up to defend against the threat of fake currency.
"This market is finding new growth opportunities thanks to the rise of new retail automated devices such as portable point-of-sale terminals," the report said. "Governments around the world are making an effort to minimize the use of fake cash."
The deal with the G10 bank should lead to more opportunities with other banks, Sekelsky wrote.
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Meta Materials Inc. (MMAT:NASDAQ; MMAX:CSE; MMAT:FSE)
"Given the time and costs associated with testing a particular security feature for a banknote, we view the KolourOptik® vertical as a potentially stable business with sticky customers," he wrote.
Ownership and Share Structure
About 15% of META is held by management and insiders, according to Yahoo Finance. Among them is President and Chief Executive Officer George Palikaras, who owns 8.3% or 29.9 million shares, Reuters reported.
Yahoo said about 11% of the company is held by institutions. Some of the top holders are State Street Global Advisors (US), with 4% or 14.49 million shares, and Nova Scotia Innovation Corp., with 3.45% or 12.5 million shares, according to Reuters.
The rest, 74%, is retail.
The company has a market cap of $97.13 million, with 362.2 million shares outstanding and 307.5 million free-floating. It trades in a 52-week range of US$2.34 and US$0.173.
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