Nanalysis Scientific subsidiary KPrime bags $126m contract from CATSA
Nanalysis Scientific Corp., a scientific instrument manufacturer, has won a CAD 160 million ($126 million) service and maintenance contract from Canadian Air Transportation Security Authority (CATSA).
The six-year contract was awarded to its fully-owned subsidiary K'(Prime) Technologies (KPrime). It will support imaging and other security screening equipment at all Canadian airports.
The contract includes a gradual phase in period of nearly 12 months.
According to Nanalysis Scientific, it is common that such contracts need to be renewed for five more years, thereby making it a potential recurring revenue opportunity for 11 years with increases in the inflation-based contractual price.
The scientific instrument manufacturer added that the contract came into effect on 25 May 2022 and expires on 31 May 2028.
Sean Krakiwsky — Nanalysis Scientific Founder and CEO said: “The security market is a very important vertical for all our products, including benchtop NMR, and it is our vision to have direct sales and service capabilities in every major market in the world.
“This contract win is an instrumental step in simultaneously opening up the security vertical as well as adding a material recurring revenue stream to our business. In addition to world-class R&D and manufacturing, we are now a world-class equipment service provider. We expect to expand this business in the security vertical, globally, as part of our growth plans going forward.”
KPrime is said to have started the phase in process for the project to airports across the country. Nanalysis Scientific expects the service coverage to be wrapped up by the end of the first quarter of 2023.
Kham Lin — KPrime Founder and President and Nanalysis Scientific Security Business Managing Director said: “We have been positioning KPrime to win this contract for several years but needed to be part of a larger organization to conduct business of this size. This contract win is one example of how Nanalysis + KPrime will enable larger business opportunities and value creation for shareholders.
“We currently provide service in airports and other security markets, and so we are well positioned to expand this business. This business also opens sales channels for Nanalysis’ proprietary products going forward.”