A MALVERN company has been given £2.5m to develop the next generation of liquid crystal displays (LCDS).

ZBD Displays, at Malvern Science Park, was founded in July 2000 as one of the first spin-off companies from DERA (now QuinetiQ).

The firm is developing a new type of LCD, called the Zenith Bistable Device, which uses very little power and maintains its display even when switched off. It is hoped to use it in mobile phones, hand-held computers, smart cards etc.

QuinetiQ has given the firm £680,000 - the rest has come from Dow Chemical, Prelude Trust and TTP Ventures.

"We won't actually be making them here in Malvern but we are in discussion with potential licensees for their manufacture," said Dr Cliff Jones, of ZBD Displays. If all goes to plan, consumer products featuring the new displays could be on the shelves by 2004.

Hal Kruth, chief executive of QinetiQ Ventures, said he was pleased with the development.

"ZBD's spin-off from QinetiQ two years ago was an important step in the development of this world-changing technology," he said.

"We're very pleased with the progress ZBD has made and are delighted to be able to continue to play a part alongside our fellow investors in the company's success."

- Liquid crystal displays were invented in Malvern in 1972 by DERA and each important development in LCD technology was pioneered there.