REG - Agronomics Limited - Agronomics invests US$2m in Liberation Labs

AgronomicsAnnouncement

15/10/2024 07:00

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RNS Number : 1220I  Agronomics Limited  15 October 2024

Agronomics (https://agronomics.im/) Limited (https://agronomics.im/)

("Agronomics" or the "Company")

Agronomics invests US$ 2 million in Liberation Labs US$ 3.5 million fundraise
and

US Department of Defense US$ 1.39 million award

Agronomics (LSE: ANIC), a leading listed company in the field of cellular
agriculture, reports that portfolio company Liberation Labs Holdings Inc.
("Liberation Labs") has raised a further US$ 3.5 million via a Secured
Promissory Note ("Note"), including a US$ 2.0 million subscription from
Agronomics using its own cash resources. The Note pays interest at 10% per
annum and matures on 10 October 2027. Liberation Labs has also received a US$
1.39 million award under the US Department of Defense's ("DoD") Distributed
Bioindustrial Manufacturing Program.

The Note, a form of convertible debt, is for financing the continued
construction of its facility in Richmond, Indiana in advance of Liberation
Labs' intended Series A round (a "Qualified Financing") as set out in the 5
April 2024 announcement. The Notes will convert into the same instrument and
terms as the Qualified Financing and are anticipated to raise a minimum of US$
37.5 million through a combination of debt and equity.

 

Department of Defense Award

In addition, Liberation Labs has received a US$ 1.39 million award from the
DoD to conduct a detailed feasibility study (engineering and market analysis)
for the addition of a flexible-use, commercial-scale 4 million litre
biomanufacturing facility adjacent to its Launch Facility.

 

The award is part of DoD's Distributed Bioindustrial Manufacturing Program
(https://www.defense.gov/News/Releases/Release/Article/3662704/dod-launches-distributed-bioindustrial-manufacturing-program-to-bolster-domesti/)
, established by the White House's Executive Order 14081
(https://www.whitehouse.gov/briefing-room/presidential-actions/2022/09/12/executive-order-on-advancing-biotechnology-and-biomanufacturing-innovation-for-a-sustainable-safe-and-secure-american-bioeconomy/)
, "Advancing Biotechnology and Biomanufacturing Innovation for a Sustainable,
Safe, and Secure American Bioeconomy." The programme aims to bolster America's
bioeconomic strengths while helping the Department achieve advanced defense
capabilities and supply chain resiliency.

 

Upon successful completion of the Prototype Assessment and Planning phase,
Liberation Labs may be selected to proceed to the Prototype Build phase, which
would provide up to US$ 100 million for building new facilities or expanding
current facilities for bioindustrial manufacturing.

Agronomics' Executive Chair Jim Mellon commented:

"In 2020, McKinsey estimated that approximately 60% of all physical inputs of
the global economy could be produced via biomanufacturing. The DoD's recent
commitment to invest across fabrication, firepower, fitness, food and fuel,
demonstrates the potential of a biomanufacturing ecosystem in which the
benefits of more secure and reliable supply chains are delivered across
industries.

In line with this, Liberation Labs' has made significant steps towards
securing binding offtake agreements for its Launch Facility. The company now
has signed letters of intent with potential customers representing well over
200% of the available capacity for the first few years of operations,
demonstrating strong demand for "fit for purpose" biomanufacturing facilities
across food, fuel, materials and pharmaceuticals."

Since the US$ 2.0 million subscription from Agronomics is considered a
Substantial Transaction under AIM Rule 12, this announcement requires certain
disclosures under Schedule Four. Liberation Labs is an early-stage company
with no revenues and operating costs of approximately US$ 0.4 million per
month, and total assets as at 30 June 2024 of approximately US$ 49.5 million
and liabilities of US$ 43.8 million.

Including this Note, Agronomics has invested US$ 19.6 million in Liberation
Labs which, subject to audit, is currently carried at a book value of £25.7
million. This funding round, however, will have no impact on the Liberation
Labs current carrying value. The position represents approximately 15.9% of
Agronomics' last stated Net Asset Value, including post-balance sheet date
adjustments. Agronomics now holds 37.5% of Liberation Labs on a fully diluted
basis.

The following have each subscribed US$ 0.5 million on identical terms to
Agronomics: New Agrarian Company Limited, an affiliate of Agronomics; Galloway
Limited; and Jim Mellon, Executive Chair of Agronomics, in his own name.
Galloway Limited is indirectly wholly owned by Jim Mellon and Denham Eke is a
director.

About Liberation Labs

Liberation Labs is commercializing precision fermentation with a global
network of purpose-built manufacturing facilities that enable the next wave of
biotechnology advancements to produce bio-based consumer products at scale. We
combine modern technology with fit-for-purpose design to bring reliable and
cost-effective solutions that meet customer demand across the world. More
information is available at www.liberationlabs.com
(http://www.liberationlabs.com) .

About Agronomics

Agronomics is a leading London-listed company focussing on investment
opportunities within the field of cellular agriculture. The Company has
established a portfolio of over 20 companies in this rapidly advancing sector.
It seeks to invest in companies owning technologies with defensible
intellectual property that offer new ways of producing food and materials with
a focus on products historically derived from animals. These technologies are
driving a major disruption in agriculture, offering solutions to improve
sustainability, as well as addressing human health, animal welfare and
environmental damage. This disruption will decouple supply chains from the
environment and animals and improve food security for the world's expanding
population. A full list of Agronomics' portfolio companies is available at
https://agronomics.im/ (https://agronomics.im/) .

For further information please contact:

 Agronomics Limited   Beaumont Cornish Limited  Canaccord Genuity Limited       Cavendish Capital Markets Limited  Peterhouse Capital Limited  SEC Newgate
 The Company          Nomad                     Joint Broker                    Joint Broker                       Joint Broker                Public Relations
 Jim Mellon           Roland Cornish            Andrew Potts                    Giles Balleny                      Lucy Williams               Bob Huxford

 Denham Eke           James Biddle              Harry Pardoe                    Michael Johnson                    Charles Goodfellow          Anthony Hughes

                                                Alex Aylen (Head of Equities)   Charlie Combe
 +44 (0) 1624 639396  +44 (0) 207 628 3396      +44 (0) 207 523 8000            +44 (0) 207 397 8900               +44 (0) 207 469 0936        agronomics@secnewgate.co.uk

 info@agronomics.im

Nominated Adviser

Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.

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