Those who calculated $1+ might have been right!
“BioA's Company’s assets are comprised of its 30,000 Ton capacity Sarnia production facility, inventory, accounts receivable, trademarks, patents and other intellectual property, tax loss carryforwards (NOL), and other moveable assets.” document bioamber-009_060718.pdf
Some of the potential buyers were considering building a plant. So they may consider that a new Plant Construction cost is US$141M (2015) and the replacement cost of the Sarnia facility is US$175- 185M. Myriant is currently in the process of evaluating plan to build plants in key geographies across the globe for the production of bio-succunic acids and other high-value, green specialty chemicals in large established markets. So we know that they have the CASH!
Some potential buyers were very interested in having a market share on the revenues of green products like the succinct acid market. They will see a top-line growth of US$4.68M representing a 750% YoY increase between from Q4 2016 to 2017. Increased demand for the product has been seen since oil price ramp up from 30$USD/bbl. in January 2016 to 70$USD/bbl. Cash and account receivables can increase from recent succinct acid sales and production but having an active customer list it is highly valuable and should also be appraised.
Mitsubishi Chemicals is currently pursuing organic and acquisition investments in biobased petrochemical alternatives through internal R&D and joint ventures. The firm has already demonstrated proven interest in bio- succinic acid through its partnership with BioAmber. So we know that they also have the CASH ready.
April 2011: BioAmber Partners with Mitsubishi Chemical in Succinic Acid
Feb 2018: Mitsubishi Chemical Starts Full scale Sales of New Grade of ‘DURABIO’ Bio-based Engineering Plastic for Bottles
Trademarks, patents and intellectual property have been assessed at $6mil but they might be even the most valuable to some like BASF. Although currently has the potential to manufacture bio-succinic acid, BASF's production capabilities is relatively small compared to other global players. Acquiring BioAmber could transform BASF into a serious contender in the biobased niche.
Additionally current partners Cargill and Mitsui will highly benefit from an acquisition by reducing their overhead costs automatically and saving their invested energy in the partnership.
As noted by Jerome Hass and Nextant, several of these strategic buyers have been interested in producing in this Sarnia plant for some time. Who will emerge as the buyer from this group of competing offers? Pwc stated objective in this buyout process has been to get maximum value for all assets for stakeholders!
