Green chemicals company Genomatica files for IPO
Genomatica looks to raise $100 million with a process for converting sugars, rather than oil, into chemicals used in everyday products.
Genomatica, a company that makes chemicals from plants rather than oil, said today it plans to go public and raise $100 million.
The company today filed its S-1 document with the Securities and Exchange Commission and laid out its strategy and risks. Genomatica follows a handful of other green-tech companies that have filed to go public this year, despite the recent rocky ride of the stock markets.
San Diego-based Genomatica makes industrial chemicals used in the production of everyday products, such as plastics used ininteriors, pharmaceuticals, and apparel.
Instead of using oil or natural gas as a feedstock to make chemicals, Genomatica has a biotechnology process for converting sugars into specific products that are.
It is now operating a demonstration-scale plant where genetically engineered e.coli bacteria, called 1,4-butanediol in the industry. It plans to build a commercial-scale plant with a partner by the end of next year. The company yesterday announced that it produced a and said it has a pipeline of 20 "basic and intermediate" chemicals.
In its prospectus, Genomatica emphasizes the economic advantage of its process above sustainability, particularly for smaller-scale plants. "Our processes are designed to deliver better economics with enhanced sustainability and a smaller environmental footprint than conventional petroleum-based manufacturing processes," its said in its S-1.
An important aspect to the company's technology is the ability to use different sources of sugars. Initially, it will rely on sucrose from sugar cane or sugar beets but it can also use dextrose from corn or cassava. It is also developing processes around non-food plants, or cellulosic biomass, and to use synthetic gas, or syngas, from municipal solid waste.
Genomatica also noted a number of risks in its prospectus, including the fact that it has never operated a manufacturing plant at large scale and that it is reliant on partners' expertise and investment to build those commercial plants.
The company represents some of the characteristics of successful green-technology start-ups that have managed to commercialize a promising technology.
Rather than seek to break into the fuels industry, which has very low margins, it is targeting specific products with higher margins. It is alsoto scale up its process and selling its product on economic, rather than solely environmental benefits.