BNDES awards Solazyme joint venture a loan for Brazilian facility
Solazyme Bunge Renewable Oils, a joint venture between Solazyme Inc. and wholly owned Bunge Ltd. subsidiary Bunge Global Innovation LLC, has received approval for a R$245.699 million ($120 million) loan from the Brazilian Development Bank (BNDES). The 8-year loan will have an average interest rate of approximately 4 percent annually.
According to information released by Solazyme, the funding will support the joint venture’s first commercial-scale renewable oil production facility in Brazil. The facility is being constructed adjacent to Bunge’s Moema sugarcane mill in the state of São Paulo.
The facility broke ground in mid-2012 and is expected to be operational by the fourth quarter of 2013. The initial production target for the plant is 100,000 metric tons of algae oil per year. The companies plan to expand global production facility to 300,000 metric tons by 2016. Information released by the companies specifies that the facility will service the renewable chemical and fuel industries within the Brazilian marketplace.
On Jan. 16, Solazyme also announced that, subject to certain considerations, it intends to offer $100 million aggregate principal amount of Convertible Senior Subordinated Notes due 2018 (the “Convertible Notes”) in a private placement. The company also said it intends to grant to the initial purchaser of the Convertible Notes a 30-day option to purchase up to an additional $15 million aggregate principal amount of the Convertible Notes solely to cover over-allotments. According to Solazyme, it intends to use the proceeds to fund project-related costs and capital expenditures, and for general corporate purposes.