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The unquoted Water Enhancement Technology (WET) Group has developed formidable expertise in the specialised water treatment market, which has grown sharply, especially in the US. Having invested over £10m in undertaking this research and in developing a range of products for the market over a six-year period, WET – a Knowledge Intensive Company (KIC) – now seeks to monetise its IP. While COVID-19 has delayed its planned rollout, WET’s Natralysis Process (NP) will be central in generating future revenues. Currently, WET is best known for its Pure Ionic Water (PIW) elite brand that is supplied to leading Premier League football clubs, including Manchester City and Chelsea.
WET’s focus is on the enhanced water market and, as a B2B supplier, it seeks to provide its specialised water services, especially to major soft drinks beverage manufacturers. Aside from the UK, the US is WET’s prime target market; it also has some involvement in the Far East.
Central to WET’s technology ‒ through which it holds many patents ‒ are the advances it has made in developing its filtration systems, which are adaptable across various sectors; albeit the beverage industry offers the best short-term prospects. Looking forward, the strong political momentum to reduce the sugar content of soft drinks also presents WET with a one-off opportunity.
While NP is undoubtedly WET’s prime product, its PIW offering is attracting real interest among leading UK sporting clubs – and especially in the Premier League football sector. WET has also developed the Guidance Enhanced Membrane (GEM) that decontaminates water – it has real prospects in the UK agricultural sector.
To finance its route to commercial viability, WET is seeking to raise ca.£1.5m of new capital, based on a £39m Directors’ valuation. Its previous fund-raise provided £1m, which was underpinned by a £25m valuation. This fund-raise and the product rollout have been delayed by COVID-19; in the interim, various furlough payments were received.
In seeking to monetise its R&D successes in water enhancement technology, WET’s focus on generating core revenues from NP and PIW will be paramount – and is something that any potential investor should monitor closely. Clearly, investment in WET comes with numerous risks – a feature that applies to many aspiring companies seeking to move away from R&D to commercial viability.