RE:RE:RE:RE:frustrating stock!The Eurozone tender process allows companies to showcase the technical merits of their offering, and probably also quote a general price per excise taxable unit of measure. I think the goal is to achieve the benefits of a pan-European standard, while bringing the technology involved into the 21st century.
Tax avoidance has been identified as a major problem, which is also a crisis in some countries closest to the border of the continent. This fuel problem is not just about taxes. After the Paris climate agreement, there is also a focus on dirty, polluting, emission equipment damaging adulterated products.
Each country will be responsible for its own timetable for adoption of the winning supplier's product. You would expect that the timetable will be variable, but there will also be a final date (yearend?) when all need to be on board. Stay tuned as we will probably get news of each country in dribs and drabs through 2016. The rate of adoption will be very relevant to EUO's royalty schedule. We know SICPA is bidding. Does anyone know when the winner will be announced?
Although it was only formalized 60 days ago, this GFI agreement has been in discussions for nearly a year now. I would be surprised if a company with the marketing abilities and connections of SICPA, hasn't got several agreements with other countries already lined up? Maybe even some that GFI had already done preliminary work on, earlier in 2015? News of these could come well before we hear anything from the Eurozone.
SICPA could have spent a lot of time and money, developing their own tag and trace for fuels to round out their product offering. But with the GFI patents involved, they couldn't duplicate GFI's superior product. The biggest, best company in the universe didn't go looking for a second rate solution. The fact that GFI was toiling in relative obscurity made it appear to be much less than it was. But all large transactions only feel comfortable between large organizations. Size does matter, and now EUO with their sponsor can benefit from this truth!
Here is the initial tweet from SICPA about the deal. They seem pleased!
SICPA ACQUIRES NEW MARKING CAPABILITY FOR OIL & GAS
Prilly, Switzerland, January 1, 2016
SICPA is pleased to announce today the finalisation of its acquisition of Global Fluids International (GFI) from the Canada based Eurocontrol group.
This acquisition extends the range of the SICPA Group’s product marking and ‘track and trace’ portfolio. It complements and completes the scope of SICPA’s unique offering to Government clients worldwide: comprehensive solutions aimed at enhancing excise tax collection capability, tools to protect local economies and support health and environmental control policies.
GFI brings with it cutting-edge capability to mark oil products at molecular level, notably through the Petromark™ programme. GFI’s markers work as an ‘’ in-product tax stamp’’ that cannot be altered or copied. On the detection side, this technology is highly accurate and exploits advanced spectrometry techniques. It provides Governments with a sophisticated tool to tackle fraud in the oil sector, focusing on downstream products but with a unique ability to mark crude in the midstream process. The technology is capable not only of providing court admissible evidence of fraud once detected, but of assisting authorities in identifying specific points in the supply chain where adulteration might have taken place.
From 1 January 2016 SICPA-GFI’s oil marking activity will be managed from SICPA HQ in Lausanne and will benefit from the strong R&D and organisational support of the SICPA Group in Switzerland and globally - essential to maintaining and further developing its technological lead and international offering.