Royalty negotiations for novel carbon-capture technology

Context

A major ASX-listed resources company was negotiating a licence for its IP relating to a novel carbon capture technology. Commercial terms were partly agreed, but the parties had not settled a royalty rate, and the licensee had proposed a rate without a clear valuation basis. 

What we did

  • Assessed the strength and defensibility of the IP using the SnapShot Score framework
  • Benchmarked royalty rates for comparable technologies and licensing structures
  • Analysed the IP’s contribution to the licensee’s projected earnings

Impact

Armed with a grounded royalty range, the client negotiated a rate about 25% higher than first proposed.