Shares in Seeing Machines Ltd (AIM:SEE, OTC:SEEMF) jumped 11% after it inked an exclusive collaboration deal with Magna International (TSX:MG) (Magna International (TSX:MG)), the Canadian auto parts maker, which brings with it US$65mln of investment.
The pair have agreed to jointly develop and co-market a driver and occupant monitoring system based on Seeing Machines’ AI-based eye-tracking technology.
The investment comes in the form of a US$17.5mln exclusivity payment with up to a further US$47.5mln via a convertible loan note.
Seeing Machines chief executive Paul McGlone said: "We are extremely pleased to see Magna's investment as we work closely together to win market share targeting the interior rear-view mirror and grow our mutual businesses.
Funded to deliver
“Seeing Machines is now funded to deliver on our current business plan and we look forward to focusing on achieving significant growth across each of our target transport sectors."
The new product will embed a camera in the rearview to monitor both the driver and occupants of vehicles.
Seeing Machines is a pioneer of technology that is able to monitor driver and fatigue and distraction.
The shares advanced 0.64p to 6.44p on the news, which City broker Cenkos called a ‘game changer’ for the business, ‘demonstrating the great value a major industry player sees in the company’s technology’.
Poignant marker
“We view this deal as a poignant marker on what is likely to be a steep trajectory over the next few years to Seeing Machines becoming a multi-billion dollar technology company,” investors were told.
Cenkos also said concerns over the balance sheet had also been allayed as it upped its price target to 25p a share from 20p.
----adds detail and broker comment---