Another Cleantech Firm Jumps Into the IPO Mix

BioAmber is gearing up for action

   

As oil prices continue to remain at lofty levels, it’s getting tough for chemicals companies.  But several operators are finding alternatives by using plants and biomass.

And one of those companies, BioAmber, has recently filed to go public. Underwriters include Goldman Sachs and Credit Suisse, and the proposed ticker symbol is “BIOA.”

A three-year-old company, BioAmber relies on core technology that’s based on funded research from the Department of Energy that goes back to the late 1990s.  The company has an exclusive license to this intellectual property.

BioAmber’s platform combines industrial biotechnology, purification techniques and chemical catalysts to transform renewable feedstocks into chemicals.  Based on its own analysis, these are more cost-effective than petroleum-based alternatives (at a crude price of $35 per barrel).

To ramp things up, BioAmber put together a manufacturing facility in Pomacle, France.  It has a capacity to produce 350,000 liters of output.

The company has plans for other facilities, which the IPO will certainly help to fund.  One will be based in Sarnia, Ontario, which should go into production in 2013.  There are also plans for locations in Thailand and perhaps Brazil.

These efforts also require the help of key strategic partners. BioAmber has  key arrangements with global operators like Mitsubishi Chemical, Cargill and DuPont (NYSE:DD).

BioAmber’s chemicals serve a variety of purposes, such as spandex, plastics and polyesters, with a market potential of more than $10 billion.

Yet none of the products are currently on the market.  But over the next couple years, this will change.  The company already has supply agreements for 84,000 metric tons of bio-succinic acid.

Interestingly enough, several other so-called cleantech companies have already hit the markets this year.

Company Ticker Aftermarket Return
KiOR KIOR +6%
Gevo GEVO -69%

It’s a mixed performance, meaning BioAmber is likely to face some headwinds with investors.


Article printed from InvestorPlace Media, http://investorplace.com/ipo-playbook/bioamber/.

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