Total’s exit strategy from its early-stage investments is becoming clearer by the month.
Last Friday Englewood, Colo., biofuel maker Gevo (IPO) to raise $150 million. Advising the start-up are UBS, Goldman Sachs�as well as Piper Jaffray.
A few months earlier Amyris, another biofuel developer backed by the French oil and gas major, also filed an S1 with the Securities and Exchange Commission (SEC) seeking to raise about $100 million. Morgan Stanley, Goldman Sachs and J.P. Morgan are advising that IPO.
Both companies are unproven in the commercial sphere but have each developed neat, cutting-edge technologies.
Gevo produces butanol, has developed�a process that transforms sugar cane or other agricultural byproducts into butanol using genetically engineered microbe. Backers say butanol is more efficient than sugar or corn-based ethanol and it can be shipped in existing fuel pipelines without a risk of corrosion and can also run in standard gasoline engines at 85% concentration.
A few weeks ago Gevo purchased an ethanol facility in Minnesota. It says that in two years it plans to make isobutanol corn, wheat, and sugar cane and down the line will use non-food, cellulosic feedstocks.
Amyris, backed by a process developed at the University of California � Berkeley, has created a sugar-based hydrocarbon molecule that can be converted into greener jet fuel, industrial chemicals or biodiesel.
Green IPO, so far, have not had a positive track record, hampered by investor-concern over ability to scale production to commercial (and profitable) levels. At the very least, both Gevo and Amyris will tout their strong institutional backing, including Total’s, to convince potential investors to buy into the IPO.