Houston-based specialty chemical company Solugen Inc. — a "unicorn" thanks to some major funding rounds in recent years — is the latest local company to take its expertise to an out-of-state project.
Solugen struck a deal with Chicago-based food processing giant Archer-Daniels-Midland Co. (NYSE: ADM) to build a 500,000-square-foot biomanufacturing facility near ADM’s corn complex in Marshall, Minnesota. The facility will utilize dextrose — a sugar similar to glucose — provided by ADM to scale Solugen's existing line of lower-carbon organic acids and develop new, innovative molecules to replace existing fossil fuel-based materials.
“The strategic partnership with ADM will allow Solugen to bring our chemienzymatic process to a commercial scale and meet existing customer demand for our high-performance, cost-competitive, sustainable products,” said Gaurab Chakrabarti, co-founder and CEO of Solugen.
Solugen plans to begin off-site construction this year and on-site construction in early 2024. The initial phase, which is scheduled to start up in the first half of 2025, is expected to create at least 40 permanent jobs and another 100 temporary construction jobs during commissioning.
The project will use Solugen’s Bioforge technology, which converts plant-derived substances into essential materials that have traditionally been made from fossil fuels.
“The initial phase of the project will significantly increase Solugen’s manufacturing capacity, which is critical for commercializing our existing line of molecules and kicks off plans for a multiphase, large-scale U.S. Bioforge buildout,” said Sean Hunt, co-founder and CTO of Solugen.
The Minnesota plant follows Solugen’s construction of a Houston factory that Hunt described as a “mini-mill” in 2020. At the time, Hunt said the Houston mini-mill's production capacity was expected to ramp up to over 10,000 tons of its bio-based chemicals per year.
In 2021, Solugen landed one of the largest funding rounds in Houston, a $350 million Series C round led by GIC, Singapore's sovereign wealth fund, and Scottish investment management firm Baillie Gifford. Following the round, Solugen's valuation jumped to more than $1.8 billion, giving the startup unicorn status. Solugen followed that funding round with a $200 million Series D round in November 2022, breaking the $2 billion valuation mark.
Other local biochemicals manufacturing companies that have seen rapid growth include Cemvita Corp., which recently agreed to sell up to 1 billion gallons of its sustainable aviation fuel to United Airlines (Nasdaq: UAL). Like Solugen, Cemvita also has plans to design biomanufacturing facilities and launched a pilot plant of its technology earlier this year.
Houston Inno named Solugen as one of its 2022 Inno Fire Awards winners last year.
