Arcadia Biosciences Inc (NASDAQ:RKDA) announced a series of strategic transactions Thursday with Bioceres Crop Solutions Corp (NYSE:BIOX), namely the sale of its membership interest in Verdeca, the soybean joint venture the two companies formed in 2012.
"Verdeca has been a truly successful venture between our two companies," Bioceres CEO Federico Trucco said. "However, as we enter the HB4 commercial phase, we and our Arcadia partners agree that the joint venture is no longer an optimal structure. Therefore, we opted to acquire 100% ownership of Verdeca, while at the same time welcoming Arcadia as a BIOX shareholder."
Arcadia received nearly 1.9 million unregistered shares of BIOX common stock and a royalty stream of as much as $10 million on HB4 soybean sales.
"For more than a half-dozen years, we've successfully collaborated with Bioceres through our Verdeca joint venture to combine our capabilities in plant genomics, product development and global crop deregulation to bring the first drought tolerant, herbicide resistant product - HB4 soybeans – to market," Arcadia CEO Matthew Plavan said. "Receiving a sizable stake in Bioceres and ongoing HB4 royalty revenue allows Arcadia to continue sharing in the HB4 opportunity, while the cash component of the transaction further strengthens our balance sheet."
Bioceres also acquired license rights to Arcadia's GoodWheat technologies in South and Central America for $6 million, with an additional $2 million to be paid once Verdeca hits certain regulatory and commercial milestones
"South and Central America are important wheat markets for our GoodWheat products," Plavan said. "Bioceres is the ideal partner to represent our brand, as we seek to leverage their deep network of production and commercial partners together with their integrated product offerings in crop nutrition and crop protection."
Bioceres anticipates strong demand in the region.
"We are very pleased to collaborate with Arcadia on its GoodWheat platform," Trucco said. "We have followed the development and initial market reception of the GoodWheat portfolio of products in the United States and are eager to be the first to bring these high-value products to South and Central America, where we expect the grower demand to be strong and the food ingredient applications to be broad."
Third quarter results
Arcadia also published its quarterly results Thursday, revealing revenue of $314,000 in the three months ended September 30, compared to $392,000 in the same period in 2019.
The company narrowed its net loss year-over-year to $6.4 million, $0.60 per share, from $14.2 million, $2.04, per share. Arcadia attributed the slimmer loss to a $7.8 million non-cash expense recognized in the third quarter of 2019 based on a significant increase in the fair value of common stock warrant liabilities compared to $1.1 million of non-cash income recognized in the third quarter of 2020 associated with a decrease in these liabilities.
"I am pleased to report Arcadia has achieved a number of fundamental milestones, resulting in a stronger financial wherewithal to achieve our number one goal: driving near-term shareholder value by unlocking the full potential of our commercial-ready products," Plavan said.
Arcadia has scheduled a webcast for 4:30 pm ET on Thursday to discuss the results. Interested parties can dial 1-844-243-4690 toll-free in the US or 1-225-283-0138 internationally and use the passcode 1303009.
Contact Andrew Kessel at [email protected]
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