Shares in tracking tech stock Bluechiip (ASX:BCT) are on the up after it put a legal case with a key customer to bed.

Bluechiip sells tracking technology intended for, among other things,  medical samples requiring storage in sub-zero temperatures.

San Francisco-based labware solutions company and long time customer Labcon last year dropped a bombshell when it said it would walk away, causing Bluechiip’s shares to sink.


Case settled

Today a settlement was announced that not only leaves Bluechiip with more than it intended to recoup last year but sees Labcon continue as a customer.

Labcon and Bluechiip entered into a new supply agreement for Bluechiip’s software. Labcon will pay US$850,000 in cash and return US$750,000 worth of previously sold products and enter into a new supply agreement for the next generation of products.

Bluechiip will be providing a US$1.3 million credit on sales under the new supply arrangement.

Managing director Andrew McLellan was happy that his company and Labcon had made up in light of the new products his company intended to launch.

“The market opportunity for our new products is significant; we believe demand for them will only increase in today’s world of ultra-low temperature storage and transport of highly valuable biologic materials,” he said.

Labcon’s president Jim Happ also expressed optimism about the future of the relationship.

“As world markets reopen and we emerge from the global pandemic, we are well positioned to engage customers and make progress to grow the market for Bluechiip’s unique technology and products,” he said.

“Our two teams have worked well together in the past and we believe they will continue to do so in the future.”

Bluechiip’s shares rose by as much as 30 per cent this afternoon.

Bluechiip (ASX:BCT) share price chart