Moolec Science to go public through SPAC merger

Dive Brief:

• Moolec Science, which uses genetically modified plants to produce proteins that are usually found in animals, will go public on Nasdaq through a merger with a special purpose acquisition company. The deal, with LightJump Acquisition Corp., values Moolec at $504 million. The company’s trading symbol will be MLEC.
• Moolec has created two products so far: chymosin, which is a protein used in cheesemaking that it produced in safflower; and the nutritional oil gamma-linoleic acid. The company has said it is scaling these up, and is working toward a diverse portfolio.
• The IPO market has been cold lately as inflation and a slowing economy have taken their toll on the markets. Several large food companies — including Chobani and Impossible Foods — have recently stepped back from plans to make their public debut. 

Dive Insight:

As stocks have recently tipped into a bear market, not many people are thinking about IPOs. But it will take some time for this SPAC deal to close — Moolec said it is expected in the last half of the year — and maybe at that point, sailing will be a bit smoother.

However, Moolec is already charting a course on a rough sea that excites some and makes others apprehensive. Formerly a part of Argentina’s Bioceres Crop Solutions, Moolec was spun off to commercialize the technology of using bioengineered plants to produce animal proteins.

And while it is developing its science, Moolec is also spearheading the GMforGood campaign, promoting the benefits of using genetic modification in food.

Moolec CEO and co-founder Gastón Paladini is the fourth generation in the Paladini family, whose namesake meat business is one of the largest in Argentina. In a release announcing the pending merger, he said that Moolec’s mission is looking to science to solve global food security issues. In a session at the virtual FoodEdge conference last month, Paladini explained why he finds Moolec’s mission to be so important.

“I truly believe that we need to find alternative solutions to produce animal proteins,” Paladini said. “I’m not against the traditional industry, of course, because of where I’m coming from. And also I believe that we need to co-work with established players.”

Moolec is already working with bigger players in R&D. The company announced a partnership last summer with Grupo Insud, which works in the pharmaceutical tech industry. Moolec and Grupo Insud’s joint venture will use yeast, fungi and other micro-organisms to produce animal-free ingredients complementary to Moolec’s plant-based pipeline. 

Unlike many publicly traded companies in the food business, Moolec doesn’t yet have much on the market. Its chymosin and gamma-lineolic acid are in the ramp-up stages, and no other products have yet been announced. However, Moolec says it is building its seed supply and continuing its research, and the future possibilities are huge.

In the conference session last month, Paladini said Moolec is working to leverage the power of plants — easy to grow in a variety of locations and climates, and endowed with the natural ability to create a lot of protein.

“We are actually proving that we could align these proteins with the commodity cost and structure of the plants,” Paladini said. “And if we could if we could do that, we’ll be at a starting point of nearing cost parity.”

An IPO will provide Moolec with an infusion of cash to help it become more widely established, as well as an outlet for investors to support its research and mission. But the market has not been kind to food companies, especially in the recent past. While several companies went public last year — many also through SPAC deals — the majority saw their stock prices fall below IPO prices. 

More recently, IPOs’ track record has been spotty. Vertical farming company AeroFarms was slated to go public through a merger with Spring Valley Acquisition Corp, but it was called off in October. Kalera, another vertical farming company, is still set to go public on Nasdaq through a merger with Agrico Acquisition Corp. A shareholder meeting to discuss the merger is scheduled for later this month.