Updated on 18 November 2014
Evolva Holding SA has agreed to acquire San Diego-based Allylix, Inc., a privately held yeast fermentation company with a focus on high-value ingredients, in an all-stock transaction. The acquisition will immediately expand Evolva's product and IP portfolio and enhance the competitiveness of Evolva's stevia products. Evolva will acquire Allylix in return for an overall consideration of 46 million newly-issued Evolva shares. Cargill (Evolva's partner on its stevia program) will invest $4 million in Evolva shares in support of the transaction. The transaction is expected to close by mid-December 2014.
Under the terms of the agreement, Evolva will acquire 100 percent of the share capital of Allylix in return for an overall consideration of 46 million shares from Evolva's authorised capital (16.5% of Evolva's issued share capital before the transaction, 14.1% post-transaction). Part of these shares, currently estimated at approximately six million shares, will be sold over a period of time after closing, to offset certain liabilities and transaction expenses of Allylix. Further, 2.3 million shares will be held back for 18 months after closing to secure potential indemnification obligations of Allylix's security holders under the agreement. All other shares will be allocated to the Allylix security holders and will be subject to a staggered lock-up, such that the shares will be released in twelve tranches of approx. Three million shares each, during the first year after the closing of the transaction. Evolva expects the newly created shares to be admitted to trading on the SIX Swiss Exchange by mid-December 2014.
The terms of the transaction have been approved by the Boards of both companies. The transaction is subject to listing of the new shares on the SIX Swiss Exchange. Upon completion of this transaction, Allylix will become a wholly owned subsidiary of Evolva.
Cargill, Inc., Evolva's partner on its stevia program, will support the transaction and subsequent integration through a USD 4 million equity investment in Evolva shares. The shares will be issued from Evolva's authorised capital, at market price based on the average Evolva share price for the last 30 days prior to closing and will be listed simultaneously with the shares issued to Allylix shareholders.
Subject to closing of the transaction in December, Evolva now expects the cash outflow from operations in 2014 to reach about CHF 20 million. In view of Cargill's intended investment, Evolva reiterates the expectation that cash (including time deposits) at the end of 2014 will be at least CHF 50 million. The acquisition has no impact on the revenues forecast for 2014 (at least CHF 10 million).