Test automation solutions developer QualiSystems Ltd. has signed a contract with a Chinese distributor worth $1 million over the coming year. The distributor has already paid for goods for one year. The contract is expected to increase to $1.8 million next year. The contract covers China, Taiwan, and Japan.
The Chinese distributor signed the deal following interest in QualiSystems' product by Japanese electronics giants, including Sony Corporation (NYSE: SNE; TSE:6758) , Hitachi Co. Ltd. (NYSE: HIT; TSE: 6501), Olympus Corp. (TSE:7733), and Yokugawa Electric Corporation (TSE: 6841).
QualiSystems also has distributors in South Korea, India, and Australia.
QualiSystems' software tests hardware and embedded systems. The company has raised $12 million to date. Mercury Interactive founder Aryeh Finegold serves as president and chairman.
QualiSystems launched a $15 million financing round a few months ago, but the market crisis has curtailed its plans. CEO Lior Koriat said, "Because of the crisis, we've cut costs, and accordingly halved our need for capital to $7.5 million. We've already raised half that money, and when we raise the full amount, it will give us enough air for 18 to 24 months."
Koriat added that QualiSystems' product saved its customers money. "Evidence of this is that, even though they're affected by the crisis, half of our deals come from repeat customers," he said.
Koriat said that the company was negotiating OEM deals in the US amounting to several million dollars. He added that he hoped to sign the contracts in the current quarter.
Published by Globes [online], Israel business news - www.globes-online.com - on April 7, 2009
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