Benson Hill Inc. is preparing to go public by merging with a special-purpose acquisition business in a deal that values the plant-growing tech company at $1.35 billion, the companies stated.
The operator of a stage which uses machine learning, simulations, and genetics to maximize plant growth, Benson Hill is mixing with the SPAC, Star Peak Corp II (NYSE: STPC). Benson Hill states it can create breeds of plants such as soybeans and yellow legumes which grow faster, have greater protein content, or flavor better, saving farmers resources and time.
Such ingredients are crucial for plant-based meat options, and the company is also developing products for animal feed. Quicker, more sustainable plant-growing methods are required to feed the world’s growing population and hasten the battle against climate change, analysts say.
The St. Louis-based firm expects to start commercial production of its ultra-high-protein soybean by next season and is growing a yellow-pea protein concentrate. Additionally, it has a unit that sells fresh produce to grocery stores and food vendors. The approximately $625 million in anticipated cash profits in the deal will quicken Benson Hill’s bid to reduce plant-based food expenses, Chief Executive Matt Crisp stated in an interview.
Launched in 2012, Benson Hill anticipates last year’s earnings of approximately $100 million to spike as it supplies more goods to food businesses, restaurants, and grocery shops. Money and funds held by the SPAC are anticipated to yield approximately $625 million in cash profits.
Benson Hill Latest Sustainable Startup Targeted By SPACs
Benson Hill unites the group of early-stage businesses tied to food sustainability. Benson Hill joins vertical-farming business AeroFarms, which is raising money and going public through SPACs.
Star Peak II is the 2nd blank-check firm endorsed by Morgan — a former executive in energy infrastructure company Kinder Morgan Inc., and investors from the hedge fund Magnetar Capital. The group’s first Star Peak SPAC just recently took clean-energy storage company Stem Inc. public.
Magnetar is one of the largest SPAC shareholders with almost $2.9 billion in blank-check business holdings as of the end of 2020, according to a set of regulatory filings by statistics supplier SPAC Research.
SPACs such as Star Peak II are shell companies that are listed on the public market for acquiring a private company and taking it public. They’re also known as blank-check businesses. Merging using a SPAC is now a frequent method for startups to raise huge sums and accessibility shareholders that are enthusiastic about topics like sustainability. One rationale is that SPAC mergers allow startups to make rosy projections about their organization, which are not permitted in a typical first public offering.
SPAC executives assert they are accelerating expansion for technology-driven companies that may eventually change the entire world. Skeptics assert that some low-revenue companies going public through blank-check businesses are not prepared and may hit individual investors with losses when their tech fails. Concerns about tighter regulation and lofty valuations have recently dragged down shares of SPACs and businesses they’ve taken public.
So far this calendar year, SPACs have increased over $100 billion, based on SPAC Research, doubling past 2020’s record total of over $80 billion.