REG - Agronomics Limited - Investment in Liberation Labs US$ 20m fundraise

AgronomicsAnnouncement

20/10/2022 07:00

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RNS Number : 4787D  Agronomics Limited  20 October 2022

20(th) October 2022

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

 

("Agronomics" or the "Company")

 

Investment in Liberation Labs US$ 20 million Seed Round

 

Agronomics (ANIC:LSE), the leading listed company focused on the field of
cellular agriculture, is pleased to announce it has today executed an
unconditional subscription agreement to invest up to US$ 7 million (the
"Subscription") in the US$ 20 million Seed funding round of precision
fermentation contract manufacturer Liberation Labs Holdings Inc ("Liberation
Labs").  The Subscription will be made in tranches with the initial
investment of US$ 3.5 million occurring yesterday, and the remaining US$ 3.5
million subject to call at Liberation Labs' discretion at any time within 90
days of the initial close.  Acting as co-lead investor is Siddhi Capital
(https://www.siddhicapital.co/) , a prominent and highly respected investor in
innovative food products and technologies.  Other investors including CPT
Capital (https://cptcap.com/) have also participated with additional investors
anticipated to participate by year end. The Subscription will be made using
cash from the Company's own resources.

In June 2022
(https://www.londonstockexchange.com/news-article/ANIC/financing-of-liberation-labs-with-cpt-capital/15501877)
, Agronomics invested US$ 627,000 in Liberation Labs' initial round of
financing for a 47% equity interest.  Subject to audit, Agronomics' original
investment, inclusive of the initial close of the Subscription, will be
carried at US$ 18.9 million, including an unrealised gain of US$ 14.8 million.
Following the initial investment of $3.5 million and a 100,000 for 1 stock
split of Liberation Labs shares, the Company will hold a total of 4,700,000
ordinary shares and 1,067,074 seed preferred shares, with an equity stake of
38.5% on a fully diluted basis.  The aggregate investment will account for
approximately 9.7% of Agronomics' 30 September 2022 Net Asset Value (as
adjusted for this investment). The Company will make a further announcement
should the second tranche of the Subscription be advanced.

Liberation Labs was formed to address the acute shortage in precision
fermentation capacity for the production of proteins for use in food,
including dairy, egg and other proteins.  In addition to being in extremely
short supply, the fermentation capacity being used today was built for other
purposes, mainly pharmaceuticals, and does not fit the need of most precision
fermentation proteins.  Many of the facilities currently in use are over 40
years old, and do not have the modern downstream equipment to drive quality,
yield, and production efficiency needed to compete in a global marketplace.
Further, much of this existing infrastructure is located in Europe, where the
sharp increase in energy prices is calling into question the economic
viability of these facilities.

Since its formation, Liberation Labs has made rapid progress in building out
its team and capabilities and will soon announce a site in the US Midwest
where it intends to construct its first 600,000 litre Launch Facility, the
initial step in a plan that has Liberation Labs targeting the installation of
over 24 million litres of fermentation capacity over the coming decade.  The
US has been prioritised given the shortage of contract manufacturing capacity,
the size of the market and because there is an abundance of competitively
priced sugar, power and labour.  The market is also more mature than other
major jurisdictions with the US Food & Drug Administration having already
approved the first high inclusion precision fermentation produced dairy and
egg proteins, from companies such as Perfect Day (https://perfectday.com/) ,
Remilk (https://www.remilk.com/) , The EVERY Company
(https://theeverycompany.com/) and others, each of which address multi-hundred
billion dollar markets.

Liberation Labs will use the proceeds from the Seed round to finalise its site
selection, complete pre-construction engineering, order long-lead equipment,
and continue to build out its team. The company further expects to begin the
process of contracting fermentation capacity for its first facility, with an
eye towards having that volume fully committed ahead of a planned 2024
operational launch.

Jim Mellon, executive director of Agronomics commented:-

"We are excited to continue our support of Mark and Etan at Liberation Labs.
We believe they are on a path to deliver the world's first large scale
fermentation facility that is purpose built for food applications.  This
large-scale infrastructure is one of the final bottle necks in the broad-based
adoption of precision fermentation proteins as it unlocks the path to cost
competitiveness with conventional production methods."

Mark Warner, co-founder and CEO of Liberation Labs added:-

"We are thrilled to have expanded our cap table with some of the best
investors in the alternative-protein space. Liberation Labs will use these
funds to continue our heads-down approach towards getting our first facility
up and running by the end of 2024."

Since the Subscription 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$ 75,000 per month, and total assets as at 30 September
2022 of approximately US$ 735,000 with no material liabilities.

New Agrarian Company Limited, an affiliate of Agronomics, has also signed an
unconditional subscription agreement to invest up to US$ 3 million in
Liberation Labs on identical terms and tranching as Agronomics.

About Liberation Labs (https://liberationlabsltd.com/)

Liberation Labs is commercialising precision fermentation with a global
network of purpose built, international manufacturing facilities that enable
the next wave of biotechnology advancements to produce alternative protein at
scale.

Our cutting-edge process combining modern technology and design brings
reliable, first-for-purpose approach, and cost-effective solutions that meet
consumer demand across the world.

Founded by industry pioneers with a combined 50 years of experience,
Liberation Labs is powering a new, innovative way forward that sets the
standard for the precision food fermentation industry and has a lasting impact
on achieving collective sustainability goals.

About Siddhi Capital (https://www.siddhicapital.co/)

Siddhi Capital is a leading Food and Beverage growth equity firm that combines
its investment and operating expertise to accelerate growth and unlock value
for our stakeholders. They invest in visionary entrepreneurs and businesses
that are reshaping the landscape of food with innovative products and
technologies. For more information about Siddhi Capital, please visit
www.siddhicapital.co (http://www.siddhicapital.co) .

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

Agronomics is a leading listed alternative proteins company with a focus on
cellular agriculture and cultivated meat. The Company has established a
portfolio of 24 companies at the Pre-Seed to Series C stage in this rapidly
advancing sector. It seeks to secure minority stakes 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, as
well as being fundamental to feeding the world's expanding population. A full
list of Agronomics' portfolio companies is available
at https://agronomics.im/
(https://clicktime.symantec.com/368cVqxx3R6vTFuHpf6MSE66Gi?u=https%3A%2F%2Fagronomics.im%2F)
.

 

For further information please contact:

 Agronomics                                       Beaumont              Canaccord                        Cenkos                Peterhouse Capital

 Limited                                          Cornish Limited       Genuity Limited                  Securities Plc        Limited               TB Cardew
 The Company                                      Nomad                 Joint Broker                     Joint Broker          Joint Broker          Public Relations
 Richard Reed                                     Roland Cornish        Andrew Potts                     Giles Balleny         Lucy Williams

 Denham Eke                                       James Biddle          Harry Rees                       Max Gould             Charles Goodfellow    Ed Orlebar

                                                                        Alex Aylen (Head of Equities)    Michael Johnson                             Alistair Walker
 +44 (0) 1624 639396                              +44 (0) 207 628 3396                                   +44 (0) 207 397 8900  +44 (0) 207 469 0936  +44 (0) 20 7930 0777

 info@agronomics.im (mailto:info@agronomics.im)                         +44 (0) 207 523 8000                                                         +44 (0) 7738 724 630

                                                                                                                                                     agronomics@tbcardew.com (mailto:agronomics@tbcardew.com)

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No. 596/2014, as it forms part
of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018.
Upon the publication of this announcement, this inside information is now
considered to be in the public domain.

 

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