Aemetis to acquire Edeniq and its proven cellulosic ethanol technology

Aemetis, Inc., an advanced fuels and renewable chemicals company headquartered in Cupertino, Calif, and Edeniq, a leading cellulosic ethanol technology company based in Visalia, California, announced they have entered into a definitive agreement under which Aemetis will acquire all of Edeniq’s outstanding shares in a stock plus cash merger transaction.

Edeniq has spent the past seven years developing the lowest-cost processes for producing cellulosic sugars, a technology which is currently a critical driver behind the revolution in renewable chemicals and fuels. The company has developed patented innovations that unlock cellulosic and starch sugars through a combination of mechanical and biological processes. Characterized by a low-capital, highly-operable process design that recycles expensive enzymes, minimizes water consumption, and does not require chemicals to pretreat biomass, these are solutions that can also be easily integrated into existing corn ethanol plants.

Edeniq, a private company founded in 2008, has raised approximately $100 million from some of the world’s leading venture capital firms, including Kleiner Perkins Caulfield & Byers, Draper Fisher Jurvetson, Angeleno Group, The Westly Group, I2BF Global Ventures, and other leading investors, as well as US Department of Energy (DOE) grant funding.

Edeniq’s patented technology is commercially proven, with 29 of the company’s Cellunators installed in 6 US ethanol plants. Edeniq has also signed several license agreements for its Pathway technology, which integrates the mechanical Cellunator equipment with cellulase enzymes to convert corn kernel fiber to cellulosic ethanol.

“We believe that joining with Aemetis will enable Edeniq to accelerate the deployment of the Pathway technology to the ethanol industry,” said Brian Thome, President and CEO of Edeniq.

In 2015, Edeniq generated approximately $20 million in revenue and $6 million in positive EBITDA. Headquartered in Visalia, California, Edeniq has 30 employees working at advanced research and development facilities, as well as pilot plants funded through grants from the DOE and the California Energy Commission.

Under the terms of the agreement, Aemetis expects to issue between one and two million shares of its common stock (depending on whether Edeniq stockholders elect to receive part of their consideration in cash or stock) plus cash to be paid over the next 5 years in an amount of up to $20 million (up to $18 million if Edeniq stockholders elect all stock consideration) in exchange for all of the issued and outstanding shares of Edeniq.

“The acquisition of Edeniq will further Aemetis’ plan to lead the deployment of technology to transition traditional biofuels plants into the production of valuable advanced biofuels, upgrading the existing infrastructure found at the 210 ethanol production facilities operating throughout the United States,” said Eric McAfee, Chairman and CEO of Aemetis, Inc. “Edeniq has commercially deployed its patented cellulosic ethanol technology at a number of leading US ethanol companies, and coupled with Aemetis’ extensive biorefinery operating expertise, we expect to enhance this technology to expand cellulosic feedstocks and to increase yields. We believe Edeniq’s technology offers compelling advantages to existing ethanol operators to increase profitability without purchasing additional feedstock,” added McAfee.

Upon completion of the transaction, Edeniq will operate as a wholly-owned subsidiary of Aemetis. Aemetis already owns and operates a 60 million gallon per year ethanol and 420,000 ton animal feed plant in California. It also owns and operates a 50 million gallon capacity renewable chemicals and advanced fuels production facility on the East Coast of India producing high quality, distilled biodiesel and refined glycerin for customers in Europe and Asia, as well as a research and development laboratory at the Maryland Biotech Center.

The closing of the transaction is expected to occur during the second quarter, and is subject to customary closing conditions and approvals, including the approval of Edeniq’s shareholders and the closing of financing by Aemetis to refinance certain liabilities of Edeniq that exist prior to closing.

http://www.aemetis.com

http://www.edeniq.com