Corbion acquires Bunge's share of algae feed business
SB Renewable Oils includes a facility in Brazil specializing in the production of algae ingredients, such as Omega 3 rich oil, for aquaculture and animal feed.
Corbion is now the full owner of that production plant, located in Orindiúva, which employs around 170 staff.
The Dutch producer said it is strongly committed to developing this line of business.
Under the deal, Corbion assumed Bunge's share in the external debt of the JV, including accrued interest (US $15m) and it said it has repaid Bunge's working capital loan (US $8m) as well.
Additionally, the two companies agreed to a five-year earn-out provision starting in 2021.
"That means that for one specific product - AlgaPrime DHA - we will pay an undisclosed percentage of sales to Bunge in the 2021-2026 period. As Bunge developed the idea and product, it would like to see some of the benefits of this product in the future. The maximum value of the total earn-out is US$20M, in today’s terms," a spokesperson for Corbion told us.
The SB Renewable Oils plant is located adjacent to one of Bunge's sugar mills, and the Dutch firm said it has secured long term supply agreements in relation to sugar and utilities from that Bunge facility for use in its algae ingredients production.
The relevant regulatory bodies in Brazil have approved the deal.
Corbion is planning to first bring the Orindiúva plant up to its "global standards", and then it will invest in efficiency improvement projects while also boosting capacity of that facility, said the spokesperson.
The Dutch company, which produces lactic acid, lactic acid derivatives, emulsifiers, functional enzyme blends, minerals and vitamins, only acquired its stake in the SB oils JV when it bought out the operations of the previous stakeholder, TerraVia, in September 2017, following that San Francisco based firm’s filing for bankruptcy.
