0.00 0
Joint Development Agreement: 4DS have a strategic Joint Development DIRECTORS
Agreement (JDA) with HGST a subsidiary of Western Digital that has now Guido Arnout
CEO, Managing
Director
spanned three years. This partnership will allow 4DS to have access to the David McAuliffe Executive Director
technical expertise of an international industry leader in digital storage hence
Howard Digby Non-Executive Director
reducing the amount of R&D required and therefore costs. Non-Executive
James Dorrian
Chairman,
Potential Target: 4DS could be acquired by Western Digital and HGST given
their significant investment in 4DS’ patents and due diligence. In 2016, Western MAJOR SHAREHOLDERS
Digital publically announced their intentions to back ReRAM as the future for Jim Dorrian 5.23%
Figure 1: 4DS’s approach to ReRAM is unique as it is non-filamentary, therefore does not exhibit the scaling issues that other developers
face. Source: Company
2
MAC EQUITY PARTNERS | Equity Research 4DS Memory
4DS’ ReRAM: The next storage-class memory technology
Figure 2: Notable acquisitions in the data storage services market involving companies similar to 4DS. Source: Company
Western Digital Acquired sTec 2013 US$340 million Solid State drives Cloud
Competition
4DS is the major player targeting non-filamentary ReRAM to the whole Storage Class Memory market, whilst many other
competitors are focusing their efforts on filamentary ReRAM to more specific markets (see Figure 3). The product
differentiation is likely to be sustained due to patents and other proprietary technologies. New entrants would find it difficult
to enter the market as the industry by its nature has high barriers to entry, requires technically astute staff and large capital
investment, and the difficulty in achieving commercialisation with large entities.
Figure 3: 4DS are targeting the storage class memory market as a whole whilst competitors are focusing on segments of this market. Note:
Market Cap numbers are as at March 10 2017. Source: Company
3
MAC EQUITY PARTNERS | Equity Research 4DS Memory
0.07
7
1 2 3 4 5 6 8 9 10
0.06
0.05
0.04
0.03
0.02
0.01
0
Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17
4
MAC EQUITY PARTNERS | Equity Research 4DS Memory
REFERENCES
1. 4DS Memory, 2016. ‘Addressing the massive memory storage demands of tomorrow’. ASX Announcement, 07/2016
2. IBISWorld, 2016. ‘Data Storage Services in Australia’, IBISWorld Industry Report J5922.
3. IBM Research, Available at: http://researcher.watson.ibm.com/researcher/files/us-gwburr/SCM_IBMJRD.pdf
4. 4DS Memory, 2016. ‘4DS ACHIEVES ENDURANCE MILESTONE’. ASX Announcement, 05/12/2016
5. 4DS Memory, 2016. ‘CONSISTENT ACHIEVEMENT OF STRATEGIC AND TECHNICAL MILESTONES. ASX
Announcement, 25/08/2016
6. http://www.anandtech.com/show/10562/western-digital-to-use-3d-reram-as-storage-class-memory-for-
specialpurpose-ssds
DISCLAIMER
This document has been prepared by the Sales, Trading and Investment Advisory department and not by a Research department. Mac Equity Partners
seeks to and does business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict
of interest that could affect the objectivity of this report. Investors should consider this as only a single factor in making their investment decisions. The
company featured in this document should be considered speculative in nature and carry a high degree of investment risk. Please consider if
investments in these types of companies are appropriate for your personal circumstance.
This document accurately expresses the personal view of the Author at the time of writing. Mac Equity Partners Pty Ltd (AFSL 338731, ABN 32 126
369 640), its directors, associates and employees advise that they may hold securities, may have an interest in and/or earn brokerage and other
benefits or advantages, either directly or indirectly from client transactions arising from any advice mentioned in publications to clients. Directors,
associates and employees of Mac Equity Partners Pty Ltd from time to time may hold shares in the security/securities mentioned in this Research
document and, therefore, may benefit from any increase in the price of those securities.
This research note has been prepared for and is intended for Wholesale Investors only as defined by Section 761G of the Corporations Act, 2001. In
accordance with Section 949A of the Corporations Act 2001, this document contains unsolicited general financial information only. In preparing this
document Mac Equity Partners Pty Ltd did not take into account the investment objectives, financial situation and particular needs (‘financial
circumstances’) of any particular person and no recommendation (whether express or implied) contained in this document should be considered
reliable. Accordingly, before acting on any information contained in this document, you should assess whether the information is appropriate in light
of your own financial circumstances or contact your Mac Equity Partners Pty Ltd adviser.
Mac Equity Partners Pty Ltd believe that the information herein is accurate however no warranty of accuracy or reliability is given in relation to any
information or information contained in this publication and no responsibility for any loss or damage whatsoever arising in any way for any
representation, act or omission, whether express or implied (including responsibility to any persons by reason of negligence), is accepted by Mac
Equity Partners Pty Ltd or any officer, agent or employee of Mac Equity Partners Pty Ltd. © 2015. No part of this report may be reproduced or
distributed in any manner without permission of Mac Equity Partners Pty Ltd
Mac Equity Partners Pty Ltd AFSL: 338731 ABN: 32 126 369 640
Suite 7, 29 The Avenue, Nedlands, WA 6009, Australia
T: +618 9386 4787 F: +618 9389 1464 E: info@macequity.com.au W: www.macequity.com.au