BIOEXX PROVIDES UPDATE ON STRATEGIC PARTNER PROCESS
TORONTO – April 1, 2013 – BioExx Specialty Proteins Ltd. (“BioExx” or the “Company”) (TSX: BXI), today announced that it is in advanced negotiations regarding the formation of a joint venture for the commercial scale deployment of the Company’s canola protein production technology.
The counterparties to the proposed joint venture are an existing rapeseed (canola) processing company (the “Business Partner”) and a private equity investment firm (the “Financial Partner”), both located in Europe. The proposed joint venture is intended to establish the European commercial deployment of complementary technologies, bringing the Business Partner’s specialty edible oils production technology together with BioExx’s food-grade protein technology, beginning with the construction and operation of a proposed 75,000 MT rapeseed processing facility. The Business Partner operates a proven and profitable specialty oil business in Europe, utilizing patented and unique processing technologies that are complementary to the BioExx technology. Under the proposed joint venture, the new plant would be located adjacent to the Business Partner’s existing operation in Europe. Preliminary engineering of the protein plant has already been completed.
Within the current joint venture discussions, BioExx would provide its proprietary protein technology and expertise and the Business Partner would contribute its proprietary oil processing technology and expertise. The Financial Partner would supply equity capital for construction and commissioning of the new facility. As part of the proposed joint venture, BioExx would receive cash consideration through staged payments. The companies are working to finalize ownership percentages for the joint venture and other terms of the transaction in a definitive and binding term sheet, to be completed on or about April 30, 2013. For commercial reasons, the counterparties have requested confidentiality until the definitive and binding term sheet is executed.
“Over the past several months we have extensively analyzed the integration of these two technologies. Our proposed Business Partner has a patented and globally unique oil production technology that would be transformative to BioExx. By providing high-quality feedstock, it would amplify our proprietary protein process, providing enhanced profitability and two high-value products for sale into this expanding market,” said Chris Schnarr, CEO of BioExx. “We will remain focussed through the month of April on the completion of this transaction.”
The definitive and binding term sheet for the proposed joint venture is subject to final agreement on various terms between the parties. In the interim, there can be no assurance that the definitive and binding term sheet, or the proposed joint venture, will be completed as proposed, or at all.
BioExx advises that it will provide further updates of any material developments during its continued negotiations towards a binding term sheet.
Closure of Saskatoon Facility
Based on the status of its strategic review process and as a result of its capital resources, BioExx today announced its intention to discontinue operations at its existing facility in Saskatoon, Saskatchewan.
“We have made the difficult but responsible decision to close the Saskatchewan plant in order to improve our cost structure, and monetize the value of those assets to address outstanding debts,” said Schnarr. “We recognize the tremendous contribution of our team in Saskatoon which has been instrumental in the successful development of the world’s first commercial-scale food-grade canola protein technology. There remains a compelling rationale for protein production here in Canada and we maintain every intention of bringing production capacity on line here, in accordance with our corporate strategy.”
Created May 30, 2013 | Category: Business