Lygos and Flexible Solutions to Merge

20.04.2022 - North American biochemical companies Lygos and Flexible Solutions International (FSI) have agreed to merge in an all-stock transaction. The move follows a strategic investment made by FSI in Lygos in February 2021.

Both boards of directors have approved the deal, which is expected to close in the third quarter, subject to shareholders’ approval and customary conditions.

During the past four years, Lygos and FSI have been leveraging the former’s proprietary fermentation technology platform to improve the performance of FSI’s biodegradable, water-soluble cleaning and water treatment solutions. Lygos’s technology uses bioengineering and data science to convert sustainable sugars into multi-functional organic acids, which the firms said offer performance, supply chain and environmental advantages over traditional industrial chemicals.

The firms said they intend to integrate their two complementary technology platforms, expand their portfolio and scale production to meet increasing demand for sustainable products for agricultural, industrial and consumer applications.

“In a world with increasing demand on resources, there is a greater need for alternative chemical ingredients that are reliable, scalable, and sustainable,” said Lygos CEO Eric Steen. “This merger provides the opportunity to unlock new high-growth opportunities for our business, our investors, and our customers by connecting our ingredients to existing downstream products. Together, we intend to use our collective resources to expand domestic manufacturing and revive industrial innovation by providing more environmentally friendly ingredients that enable better supply chains for common, everyday downstream products.”

Steen will serve as CEO of the combined company, while FSI’s CEO, Dan O’Brien, has agreed to stay on for five years to oversee FSI’s existing business activities.

Prior to the transaction, Lygos secured $160 million in growth capital in support of the prospective combination.

Author: Elaine Burridge, Freelance Journalist