Iogen looking to sell?

Iogen is probably thinking of doing the same move as Verenium when it sold its cellulosic ethanol joint venture to BP.

Iogen announced last week that it has "initiated a process to explore strategic alternatives for enhancing shareholder value and funding the deployment of its world leading renewable energy technology." The company has retained Goldman, Sachs & Co. as its exclusive financial advisor.

Like Verenium, Iogen Corporation started in the development, manufacture and marketing of enzymes. The company owns 50% stake of Iogen Energy, its joint venture with Shell, which specializes in cellulosic ethanol. Iogen Energy has been producing the biofuel from wheat straw at its Ottawa, Canada, demonstration plant since 2004.

Iogen's wholly-owned subsidiary, Iogen Bio-Products, develops, manufactures and markets enzymes used to modify and improve the processing of natural fibers within the textile, animal feed, pulp and paper, grain processing and brewing industries.

Like BP, Shell will probably buy the cellulosic ethanol business. The question is how much is Shell willing to fork over for the biofuel portfolio? While technology development for cellulosic ethanol has been progressing rapidly, enthusiasm for commercialization in North America seems to have lost its momentum.