BluGlass Now Funded Through To First Commercial Orders

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BluGlass Ltd of Silverwater, Australia – which develops low-temperature, low-hydrogen remote-plasma chemical vapor deposition (RPCVD) technology for manufacturing devices such as laser diodes, next-generation LEDs and micro-LEDs – has provided an update for the June quarter, highlighting (i) its prototype 420nm laser diode products meeting commercial specifications in light output and wavelength (while th firm works with expert fabrication specialists to resolve reliability issues); raising $8.42m via an oversubscribed entitlement offer and placements; and laser diode pioneer Jean-Michel Pelaprat joining BluGlass as a non-executive director.

Laser diode progress

During the quarter, BluGlass continued to progress the development of its 405nm, 420nm and 450nm direct-to-market commercial laser diode products.

The 420nm products are demonstrating commercial specifications for light-output, voltage and wavelength in both pulsing and initial continuous wave testing. These results confirm the commercial quality of BluGlass’ laser diode design and epitaxy. However, initial reliability testing of 420nm devices has shown a gradual loss of light output and laser performance during high-power testing. BluGlass has observed flaws in the optical facet of the laser, which is contributing to the reliability issue.

The optical facet is in the post-epitaxy production steps and involves third-party suppliers. To expedite solutions, BluGlass is working with multiple vendors and expert fabrication specialists with established production capabilities. The firm continues to pursue improvement in the reliability of its laser diodes and currently has several iterations, running in parallel, already in development.

After this issue has been addressed, the solution will then be integrated across BluGlass’ suite of laser diode products.

Due to their manufacturing complexity, gallium nitride (GaN) laser diodes are high-value, high-margin products. BluGlass is initially targeting in-demand and under-served wavelengths for use in industrial, display, defence and scientific applications.

“These manufacturing challenges are understood by the industry, and we remain confident of being able to solve this issue to launch a range of commercial laser diodes,” says executive chair James Walker. “To further support our technical activities, we are increasing our expert team, which will enable BluGlass to expedite solutions, and - once implemented - ramp-up commercial manufacturing,” he adds. “We have a large and growing addressable target market for our first direct-to-market products and are already in discussions with potential customers. Our manufacturing capability in both Australia and the US is supported by our supply chain partners, which will enable us to cost-effectively scale to meet demand.”

Utilizing its proprietary remote-plasma chemical vapor deposition (RPCVD) and tunnel-junction technologies, BluGlass’ enhanced laser diode designs are also progressing through the manufacturing supply chain. While at an earlier stage of development, the novel laser diode designs combine both RPCVD and industry-standard metal-organic chemical vapor deposition (MOCVD) processes into a single high-power device. They are designed to enable brighter, higher-power and higher-efficiency laser applications.

An update on the laser diode business progress and development plans was provided to shareholders at the firm’s ‘Meet the Chair & CTO’ briefing on 30 June.

DARPA Yale University laser diode program continues to progress

BluGlass and Yale University continue to collaborate on the US government-funded contract, assisting the Defense Advanced Research Projects Agency (DARPA) with the development of novel laser diode technology. BluGlass and Yale are conducting paid R&D under DARPA’s Lasers for Universal Microscale Optical Systems (LUMOS) initiative, combining efficient integrated optical systems and complete photonics functionality onto a single substrate.

The paid joint development program has successfully completed the milestones of the first stage of Phase I, which is expected to run for 18-months. Together, Yale and BluGlass’ research teams have commenced the second stage of Phase I and are working to combine lasers and photonic integrated circuit (PIC) technologies in a single device; for applications such as compact optical phased-array LiDAR (light detection and ranging) and neuromorphic optical computing.

Funded to first commercial orders

In June and July, BluGlass raised a total of $8.42m; comprising an oversubscribed entitlement offer to existing shareholders and two separate placements.

The firm’s non-renounceable entitlement rights issue raised the maximum $5.92m before costs. Strong support from shareholders saw shortfall applications exceed the rights issue target and a pro-rata scale back of about 4% was applied to all shortfall applicants.

BluGlass also secured $2.5m from technology-focused fund Regal Funds Management and clients of Viriathus Capital, via placements under the same terms as the rights issue.

Funds raised enable BluGlass to expedite delivery of its direct-to-market GaN laser diode products, where the firm is targeting in-demand and under-served wavelengths for industrial cutting and welding, laser displays, general lighting, and defence applications. Proceeds will also be used for investment in sales, marketing and distribution channels for its laser diode products, as well as enhanced product development and working capital.

“We are now funded to take the company through to first commercial orders,” says Walker. “We have multiple laser diode products in the manufacturing supply chain and expect to launch products as soon as the reliability challenge is overcome, to several customers patiently awaiting product delivery. There are significant unmet manufacturing needs and demand in the market at present and BluGlass is well-placed to capitalize on this opportunity,” he reckons.

Cash reserves at the end of the June quarter were $4.176m. In addition to the funds raised in the rights issue and placements, BluGlass expects to receive an R&D rebate of about $3m in September.

Leadership changes

In June, Giles Bourne stepped down as managing director and CEO after more than 13 years with the firm. Walker has assumed the role of executive chair while the company undertakes a search for an industry-experienced CEO to lead BluGlass to commercialization and profitability.

Earlier in the quarter, laser diode pioneer Jean-Michel Pelaprat joined the board as a non-executive director. He has more than 30 years’ experience in semiconductor and photonics businesses, and is a co-founder & director of US-based laser diode firm Nuburu.

“Jean-Michel joined BluGlass at a pivotal time for the company, and his extensive technical and commercial expertise has already proved to be invaluable as we progress the development of our first direct-to-market laser diode products,” comments Walker. “His affiliation with BluGlass provides potential customers with a significant vote of confidence in the quality of our disruptive technology.”

Outlook

BluGlass says that it is fully focused on overcoming the final technical hurdle to launch its range of laser diodes and secure first customer orders.

“Our direct-to-market approach provides us with a clear path to revenue,” says Walker. “We are addressing a global industry need for end-to-end manufacturing capability, and during the year ahead will prepare our supply chain to scale rapidly to meet demand for both specialized custom batches to volume production for repeat orders,” he adds. “Our collaborative laser diode customers continue to demonstrate their strong interest and support for our planned range of product launches, as they wait for us to deliver bespoke solutions to meet their specific industry needs.”

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