InterviewUS Genomatica withdraws IPO to focus on licensing tech

02 August 2012 20:56  [Source: ICIS news]

By Doris de Guzman

NEW YORK (ICIS)--US renewable chemicals developer Genomatica has withdrawn its $100m (€82m) initial public offering (IPO) because of the weak market and changes in its business strategies, it said on Thursday.

Genomatica also announced that it has raised $41.5m in private financing from new investor and partner, Versalis, the chemical business of Italy-based Eni, as well as existing investors such as Alloy Ventures, Draper Fisher Jurvetson, Mohr Davidow Ventures, TPG Biotech, VantagePoint Capital Partners and Waste Management.

“The withdrawal of the IPO comes from a number of different factors,” said CEO Christophe Schilling, in an interview with ICIS.

“In this current market environment, it is more advantageous for us to choose private financing as it will give us better opportunity to demonstrate our technology and differentiate our business model,” Schilling said.

Genomatica plans to focus more on licensing its technology as opposed to operating assets, he said.

“We are positioning ourselves to offer process technologies - not to become a producer of chemicals,” Schilling said.

Despite the change in plans, Schilling noted the possibility of an IPO again as the company moves forward.

The $41.5m financing, according to Genomatica, will be used partly for the commercialisation of the company’s bio-based 1,4 butanediol (BDO) technology and the expansion of the company’s portfolio, including the newly announced bio-based butadiene (BD) development with Versalis.

Genomatica plans to form a joint venture with Versalis and Novamont to develop an end-to-end process for the production of BD from biomass.

The partnership will combine Genomatica’s technology and intellectual property for BD production; Versalis’s catalysis process development and market applications of BD derivatives; and Novamont’s experience with renewable feedstock.

In an ICIS interview with Versalis, the company said a commercial bio-based BD plant is possible within four years.

Genomatica’s Schilling said the technology under this partnership will not use the 1,4 BDO route to produce bio-based BD.

“Genomatica has multiple technologies it is developing to produce butadiene. You can use 1,4 BDO and we’ve done that in the laboratory but we think that there are number of different ways to produce bio-butadiene that will make a lot more economical sense,” Schilling said.

($1 = €0.82)

Check out Doris de Guzman’s ICIS Green Chemicals Blog for views on bio-based chemicals

By: Doris de Guzman
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