Sept. 23, 2002 — AMR Technologies Inc. doesn’t like to bill itself as a nanotechnology company. It’s a materials company, period. It just so happens the materials are getting smaller and improving existing products.
The Canadian firm focuses primarily on rare earths. These are the dozen or so elements found on the very bottom of the periodic table — elements with names as intuitive as cerium, lanthanum and praseodymium. “One of the biggest challenges we face is just getting people to understand what rare earths are, and what it is we are doing,” said Constantine Karayannopoulos, AMR’s executive vice president.
Yet these rare earths can be engineered into products to be used in catalytic converters, Styrofoam cups and television displays.
Most of the company’s $700,000 worth of nanotechnology-related products sold in the first six months 2002 concern automotive catalysis. Catalytic converters function thanks to rare earths fixed onto a ceramic brick-like substrate. The noxious fumes created by the vehicle go into the brick, causing a chemical reaction with the rare earths and other metals. Out come less hazardous elements like nitrogen, oxygen, water and carbon dioxide.
With emissions regulations and performance requirements turning tougher, these ceramic bricks become hotter and hotter, going up to 1,000 degrees Celsius. The automotive industry needs materials that will remain stable at such temperatures, without flaking or breaking.
That’s where nano comes in. Once cerium and zirconium are broken down to nanosize, a more thermally stable synthesized material is created. The products are made to measure for automotive catalyst producers.
Research labs are located Abingdon, England. They are run by James Woodhead, a 75-year-old chemist with 50 patents to his name. The work being done by Woodhead and his team of three is kept pretty hush-hush, but it is encouraging enough for the company to open a larger nanotechnology center in early 2003 and to plan to double staffing in the new facility.
However exciting the science, AMR technologies remains a business and one that is not hugely profitable. Despite a profitable second quarter, the company reported a loss of $364,000 in the first six months of the year, on sales of $22 million, following many years of moderate profitability. “It is an interesting business, with interesting prospects, but it has been very inconsistent on the profit side,” said analyst Steven Laciak of National Bank Financial.
Its stock price is another one of AMR Technologies’ challenges. It has been trading on the Toronto Stock Exchange at around $0.80 in September, down from a high of nearly $1.30 in January. But the main difficulty stems from the illiquidity of the stock. The price of the 16.5 million shares outstanding tends to shoot up or down anytime anyone buys or sells it.
In the future, AMR Technologies is looking to engineer its rare earths even further. It also plans to develop nanocoatings for electronic systems. “There is such a diverse number of materials wanted by the world,” Woodhead said. “It used to be that people wanted cheap, but they don’t want cheap anymore — they want materials that work.”
AMR Technologies Inc.
AMR.TO (Toronto Stock Exchange)
121 King Street West
Canada M5H 3T9
Founded by Peter Gundy in 1993, via the purchase of controlling interest in two Chinese rare earth suppliers
Small tech-related products and services
AMR is a leading global supplier of rare earths and zirconium, used in industrial applications ranging from electronics to solid oxide fuel cells to catalytic converters. The company also manufactures neodymium-based magnetic powders for use in the electronics and automotive industries.
Approximately 1,100 at locations in Canada, the United States, United Kingdom, Barbados, Korea, Japan, Thailand and China.
In order to amass working capital and purchase Chinese rare earths plants in 1993, AMR raised (U.S.) $19 million.
The company raised an additional (U.S.) $3.6 million at the time of its 1995 transfer to the Toronto Stock Exchange.
The following entities have invested in AMR:
Selected strategic partners and customers
$47 million (2001)
$22 million (first half of 2002)
Barriers to market
In the short term, AMR Technologies hopes to turn around the magnetics division and spin off zirconium activities. In the long term, the company expects to invest heavily in nanotechnology research through its research and development center in Britain.
Why they’re in small tech
“As a chemical engineer, it’s a very creative business because you get to put things together and precisely engineer materials. You start with a sheet of paper and you come back with some fascinating stuff that people are willing to pay for,” says Constantine Karayannopoulos, executive vice president.
What keeps them up at night
“What literally keeps me up are calls from the plants in Asia in the middle of the night. We are small, but we have the problems of a multinational. However, we also have a front-row seat to what is happening in China, which is very exciting and hugely important for the Chinese people.”
Canadian nanofirm links with Singapore
— Research by Gretchen McNeely