Tait to Continue Strong R&D Focus with JVCKENWOOD Investment
Tuesday, December 11, 2018 | Comments

Tait Communications CEO Garry Diack said the company’s focus on research and development (R&D) in convergence technologies and Digital Mobile Radio (DMR) platform helped attract a minority investment from JVCKENWOOD.

Although Diack could not provide financial details around the investment, he said the New Zealand company is still majority owned by a Tait trust. The investment is strictly financial and will allow Tait to continue to invest more than 20 percent of its revenues in R&D as the company has done in the past.

“This investment has allowed us to be able to maintain that level of R&D investment while we grow in markets around the globe as well,” he said. “We would expect our percentage of R&D to remain in the low 20s compared with turnover. While that’s high in corporate standards, we’re not as big as our competitors, so the actual dollar amount isn’t as large as our competitors, but it allows us to remain competitive.”

JVCKENWOOD’s professional mobile radio (PMR) business and future technology view align with Tait’s business, and there are high expectations around DMR Tier 3 in industries such as public transport, rail and utilities. The DMR Tier 3 platform has potential for adding an internet of things (IoT) platform on top to provide customers, such as the Transport for London bus fleet, with new applications, Diack said.

It is likely that JVCKENWOOD will license some of Tait’s technologies, and Tait will license the Japanese giant’s products in the future. However, the investment will not lead to differences in market presence, Diack said.

He said Tait customers and dealers will see more aggressive investment in convergence technologies and more products around the globe. “We’ll have a richer form of products for our dealers,” Diack said. “Our industry is moving away from product sales to more solutions sales.”

Diack said Tait’s master distribution agreement with Harris to distribute Tait products in North America won’t be affected.

“We’re pretty grateful for [JVCKENWOOD’s] interest in us,” Diack said. “We’ve been looking for growth capital for some time, and we’ve looked for a number of sources for that like private equity and debt funding. We’re pretty pleased to have landed them. … It’s really money we will put into growing our capability set over time.”

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