Biofuel company Amyris Biotechnologies said it plans to raise $100 million through an initial public offering, one of a number of energy start-ups now seeking to tap the stock market for capital.
The Emeryville, Calif., company on Friday filed its S-1 document with the Securities and Exchange Commission, in which it laid out its plans to tap sugar cane from Brazil, now used for producing ethanol, to make different chemical products, including diesel fuel.
The S-1 also spelled out the many risks that the Amyris faces, including the high costs of building biorefineries and the potential backlash against using genetically modified organisms to make its products.
Amyris manipulates micro-organisms, primarily yeasts, so that they consume sugar and produce a desired product, which could be diesel, jet fuel, or other chemical products. The company founders had originally received a grant from the Bill and Melinda Gates Foundation to use its process for an antimalaria drug. Then, funded by venture capital companies including Khosla Ventures and Kleiner, Perkins, Caufield & Byers, they set out to also make liquid fuels using the same basic process.
The major advantage of making common hydrocarbons from sugar is that they can replace existing fuels and fit into the existing fuels infrastructure.
Amyris' strategy is to build biorefineries in partnership with Brazilian sugar cane processors and ethanol manufacturers. It set up a joint venture with Grupo Sao Martinho to start producing fuel next year at a facility that will cost between $80 million and $100 million, according to the prospectus. Working in Brazil gives the company access to a good source of sugar in sugar cane in a country with a highly developed ethanol industry. It also decreases the capital required to build facilities, Amyris said in its S-1.
Although Amyris has compelling technology, the S-1 document reminds potential investors of the numerous commercial hurdles that the company--like many other energy upstarts--face in bringing a product to market in fuels business. The company has test facilities but a limited operating record and is not yet cash-flow positive, having earned $64 million in revenue on expenses of nearly double that.
There are a number of green-tech IPOs planned globally this year, with the majority in wind and solar, according to a Bloomberg analysis. Among those IPO hopefuls are companies based in Silicon Valley, including Tesla Motors, solar company Solyndra, and biofuel company Codexis.