AAA Ceres set to feed on IPO cash

Ceres set to feed on IPO cash

Ceres, a US-based company producing biomass feedstocks, set the range for its initial public offering (IPO) at $21-$23 on Wednesday, and is expecting to raise about $98m from an offering of five million shares.

Ceres initially filed for the IPO in May 2011, pulled in an $11.4m round of debt financing three months later, adding to $95m in equity raised since 2007.  

Among the shareholders in Ceres is agricultural corporation Monsanto, which holds 6.1% of the stock. Additional investors currently holding significant amounts of Ceres stock include private equity firms Artal Luxembourg (18.9%) and Warburg Pincus (15.4%), private trust the Ambergate Trust (14.5%), venture capital firm Oxford Bioscience Partners (10.2%), private equity firm Gimv (8.4%), asset manager Oppenheimer Funds (7.6%) and fund management firm the Quantum Group (5.9%).

Investment advisor Hambrecht & Quist Capital Management and financial group KBC also hold low amounts of Ceres stock.

Ceres uses biotechnology to produce crops for biomass fuel and energy while also supplying technology to food crop specialists. The company signed a $137m discovery and development deal with Monsanto in 2002 but revenues have not been auspicious of late.

According to financial results included in the filing, Ceres is not currently profitable, making a net loss of $36.3m from revenues of $6.6m in the 12 months leading up to the end of August, compared to $22.6m from almost identical revenues the year before.

Ceres plans to invest the proceeds from the flotation in research and development, with some funds going towards marketing and the brunt left over for general working capital and expenditures.

Underwriters for the IPO are Goldman Sachs, Barclays Capital, Piper Jaffray, Raymond James and Associates, and Simmons and Company.

 

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