Biometrics security refers to using physical or behavioural traits to ensure identity.
Microlatch has a patent portfolio of 26 registered patents globally with one single patent being valued at up to US$313 million.
The patents impact the secure access to mobile computing devices such as smartphone, tablet, notebook, laptop and touchless payment platforms.
The proposed acquisition is subject to shareholder and regulatory approval.
Charter Pacific is a diversified investment company that has been listed on the ASX since 1989.
Microlatch is a leader in the design, development and manufacture of mobile biometrics solutions.
In particular, Microlatch offers wireless platforms within the access control security markets, smart home and encrypted communications.
The key technology protected by its patents relates to biometrics being aligned with RF (radio frequency), NFC (near field communication) and Bluetooth payment technology for secure access to mobile computing devices.
These patents impact on a number of companies globally using biometrics today.
The Microlatch technology overcomes the main challenge facing this emerging mobile payment market, being the security of payments within the current banking system and alternative payment platforms, as well as the secure access to all mobile digital devices globally.
Commercialising the patent portfolio
Patent attorneys have reviewed the patent portfolio and identified 35 global entities who are marketing products and services that are impacted by one or more of the patents and are potential infringers who are best seen as potential licensees.
Other entities include payment card platform providers such as Zwipe from Europe, all of whom want to expand their sales volumes and require patent and intellectual property strength to meet their objectives.
Additionally, these entities are viewing mobile payment systems as the next major global market growth area and Microlatch has several patents that would ensure a stronger patent protection position.
By acquiring Microlatch, Charter Pacific is able to generate possible future revenues through license agreements or on-selling the patents.
Charter Pacific will likely prepare for expressions of interest from a number of companies globally regarding licensing opportunities.
An independent valuation of the Remote Entry System patent has valued the patent value at US$55.8 million to US$155 million and forecasts potential licensing revenue of between US$81.1 million and US$313 million.
This patent is the only one from the portfolio to have been valued to date.
Microlatch’s patent portfolio embraces the ideology of privacy and security of personal information and data, a growing global industry.
During 2015 hackers were able to compromise 5.6 million people’s fingerprints by hacking into the U.S. Office of Personnel Management.
The key strengths of the patent portfolio are that the portfolio of patents has been registered for many years since 2003 without any challenges.
Charter Pacific intends to grow each family of patents to encapsulate new advances in technology in growing markets and take advantage of the importance of performing secure data transfer on mobile devices across multiple platforms.
Importance of the sector
As an example of the importance of the sector, on 11 November 2016, Singles’ Day, which is China’s biggest shopping day, Alibaba closed the day with US$17.79 billion in total on-line sales.
Of these, a high volume of money was spent on mobile phone transactions.
As of 1pm China time, mobile transactions represented 84% of all Alibaba sales.