Amyris files for Chapter 11 protection

November 2023 | DEALFRONT | BANKRUPTCY & CORPORATE RESTRUCTURING

Financier Worldwide Magazine

November 2023 Issue

Following the launch of a strategic transformation programme which involved cutting jobs to reduce costs, synthetic biotechnology company Amyris, Inc. has filed for Chapter 11 bankruptcy protection.

In its filing with the Delaware bankruptcy court, the company listed estimated assets in the range of $500m to $1bn and liabilities in the range of $1bn to $10bn. Amyris’ entities outside the US are not included in the Chapter 11 proceedings.

To ensure a smooth transition into Chapter 11, Amyris has filed a series of customary motions seeking to continue operating as usual and uphold its commitments to its employees and other valued stakeholders during the bankruptcy process.

These motions include requests to continue to pay wages and provide benefits to employees as usual and maintain its customer programmes and policies. Amyris has also secured a commitment from an entity affiliated with existing lender Foris Ventures for $190m of debtor-in-possession (DIP) financing to support continued day to day operations as the company works with its key stakeholders to negotiate a consensual go-forward plan centred on Amyris’ core capabilities.

Subject to court approval and the DIP budget, this DIP financing will provide liquidity to help fulfil commitments to Amyris’ employees, customers, partners and vendors during the Chapter 11 process.

At the same time, to advance its restructuring goals and maximise the value of its assets, Amyris is planning to exit its consumer brands and will begin marketing them for sale, with a view to having these brands continue to leverage Amyris’ cutting-edge science and technology while under new ownership. As the sale process progresses, Amyris will continue to operate these brands, including through retail partners and the brands’ e-commerce platforms.

“We have been hard at work on a strategic transformation plan to reduce costs, improve operational effectiveness and achieve sustainable growth,” said Han Kieftenbeld, interim chief executive and chief financial officer of Amyris. “We believe the Chapter 11 filing and restructuring puts Amyris on the best path to address its financial challenges and achieve a comprehensive solution – rooted in ground-breaking science, formulation capabilities and technology.”

“At the end of this restructuring process, we believe that Amyris will emerge as a financially stronger company with a more focused business model and well-defined path to profitability,” continued Mr Kieftenbeld. “In turn, we will be poised to grow sustainably alongside our valued partners and make an even greater impact on our world through clean chemistry.”

The restructuring is intended to improve the Amyris’ cost structure, capital structure and liquidity position while streamlining its business portfolio to focus on its core competencies in R&D and the scale-up, commercialisation and applications development of its sustainable ingredients, which are included in over 20,000 products from the world’s top brands, reaching more than 300 million consumers.

“Since its founding 20 years ago, Amyris has been a pioneer in the development of ingredients made with synthetic biology and has enjoyed great commercial success,” added Mr Kieftenbeld. “This is particularly as a result of our innovative lab-to-market technology platform, proven ability to rapidly bring new products to market, and state-of-the-art science and manufacturing infrastructure.”

Serving as legal counsel is Pachulski Stang Ziehl & Jones LLP, with PwC serving as financial adviser and Intrepid Investment Bankers LLC serving as investment banker. Philip J. Gund of Ankura Consulting Group, LLC is serving as Amyris’ chief restructuring officer.

“Our aspiration to become the most efficient and productive biotechnology company in our industry has not changed,” concluded Mr Kieftenbeld. “We remain incredibly excited about Amyris’ long-term potential and our uniquely talented team’s proven ability to deliver on the promise of synthetic biology and continue to make a lasting impact.”

Fraser Tennant