27 May 2011
Algae biofuels company Solazyme debuted on the Nasdaq today, with stocks reaching a 20% premium on its $18 offer price.
The California-based company – which makes renewable oils for low-carbon fuel, and algae-based cosmetics and dietary supplements – opened at $19.60 before climbing to $21.64 in early trading.
Solarzyme netted $198 million in the share sale, having upped it offer price yesterday from a previously projected range of $15-17.
Earlier this month, the company raised its fundraising target to $183.54 million, up from its initial $100 million goal, announced in March.
The company – which in 2010 posted revenues of $38 million and a net operating loss of $16.3 million – is backed by a range of investors including Chevron, Morgan Stanley, Unilever, venture capital firm the Roda Group and entrepreneur Richard Branson.
It has secured a fuel contract with the US Navy and offtake agreements with Dow Chemical and Qantas for the sale of its oil and jet fuel products. In addition, the firm is expanding the stockists of its algae-based luxury skin care line.
Nate Gagnon, a senior analyst at IHS Herold in New York, said Solazyme’s boosted IPO bodes well for other biofuels companies looking to go public, such as Texas-based KiOR which converts non-food biomass into renewable crude oil.
Charlotte Dudley
