Biofuels firm may list on NZX

LanzaTech has partnered with airline owner Sir Richard Branson to help turn aviation into a clean industry. Photo / Greg Bowker

The pioneering biofuels developer LanzaTech is considering listing on the New Zealand stock exchange, after it announced it had secured more than US$50 million in new funding from international and local investors.

But chief executive Jennifer Holmgren said the firm would not be in a position to go ahead with an initial public offering until the second half of this year, after it had proven its technology at a demonstration facility being commissioned at a Chinese steel plant.

"If the market's ready at that time then we're going to go [make an IPO]."

Holmgren said LanzaTech - whose proprietary microbe technology converts industrial waste gases into valuable chemicals including ethanol, used to make biofuel - had not yet committed itself to listing on any particular exchange, but New York's tech-heavy Nasdaq was the "obvious" option for its first listing.

The firm is also considering listing on multiple exchanges.

"In fact we're thinking about that [floating on the NZX] very seriously," Holmgren said.

She said the Hong Kong or Shanghai exchanges were also possible listing destinations, although companies generally needed to have multiple years of profit behind them to float on those exchanges.

The Warehouse founder and serial start-up investor Sir Stephen Tindall, whose K1W1 fund has invested in LanzaTech since 2005, said the clean-tech firm would require "some kind of dual listing".

"For the size of the expansion potential of the business they're going to need more than the New Zealand market could potentially provide," Tindall said.

However, market commentator Arthur Lim said last year that the less-than-rosy track record of some past NZX biotech listings, such as Genesis Research and Development, would weigh heavily on local investors if LanzaTech went ahead with an IPO in this country.

LanzaTech yesterday said it had closed its "series C" round of funding, with a total investment of US$55.8 million ($68.8 million) led by the Malaysian Life Sciences Capital Fund.

New investors in the round included Petronas Technology Ventures, the investment arm of Petronas - Malaysia's national oil corporation - and Dialog Group, another Malaysian firm that provides technical services to the oil, gas and petrochemical industry, the company said.

LanzaTech said existing investors - US-based Khosla Ventures, China's Qiming Ventures and Tindall's K1W1 fund - also participated in the round.

The company has raised more than US$85 million since its founding in 2005.

Sir Richard Branson's airline, Virgin Atlantic, partnered with the clean-tech firm last year in a move the billionaire said could develop aviation from a dirty industry into one of the cleanest.

TECH PIONEER
* LanzaTech has developed and patented a strain of bacteria that consumes polluting gases and converts them into ethanol, used in the production of biofuels, and other valuable chemicals.
* The company has entered partnerships with global industrial corporations and Sir Richard Branson's Virgin Atlantic.
* It is also working with the US Department of Energy, Department of Defence and FAA to adapt its technology to produce aviation fuels.