Boston-based Ginkgo Bioworks Holdings Inc. said it plans to sell $100 million of its stock in a public offering in order to pay for its acquisition of the West Sacramento Bayer Crop Science campus, among other things.
Ginkgo (NYSE: DNA) last month closed its $83 million deal with Bayer AG to take over its West Sacramento Bayer Crop Science biologics research and development site.
In a news release, Ginkgo said it will use the proceeds to replenish cash "used to finance the acquisition of certain assets and liabilities of Bayer Crop Science LP and for other general corporate purposes."
The West Sacramento deal included the 175,000-square-foot main research building and lab space at 890 Embarcadero Drive, as well as 25,000 square feet of scientific greenhouses in the same office park. Ginkgo also picked up the former Bayer employees, about 150 people, as well as intellectual property.
New York-based investment bank BTIG LLC is acting as the sole book-running manager for the offering. Ginkgo said it plans to grant the underwriter the option to buy $15 million of additional shares. All shares being sold in the proposed offering are Class A common stock being sold by Ginkgo.
The two companies came to an agreement in July for Ginkgo to buy Bayer’s West Sacramento main building with its employees, and for the companies to work together on new technologies in agriculture.
Ginkgo Bioworks uses genetic engineering to create microbes with agricultural or industrial applications.
As part of the deal, Bayer and Ginkgo will partner to develop biologics for agriculture.
Joyn Bio, a joint venture created by Bayer and Ginkgo Bioworks in 2017 and seeded with $100 million by both companies, is being integrated into Ginkgo Bioworks. Joyn has offices in Boston and labs in Woodland.
As part of the merger agreement, Bayer retains the right to commercialize Joyn’s nitrogen-fixing technology. Nitrogen is a powerful fertilizer, but synthetic nitrogen is expensive and can run off fields into water systems. Having biological organisms that are able to capture free nitrogen from the air and soil to make nitrogen compounds is seen as a breakthrough for biologics research. Nitrogen is the most abundant element in the atmosphere.
On Monday, Gingko reported a loss of $1.93 billion for the first nine months of 2022, compared to a loss of $231.6 million in the year-earlier period. The company's revenue more than doubled in the first three quarters to $379.4 million.
