Evolva revokes 2023 guidance and considers “strategic transactions” in light of financing negotiations

14 Jun 2023 --- Swiss biotech player Evolva is looking at strategic transactions, including a potential sale of the company, after entering into negotiations with its financing partner, Nice & Green. The discussions involve a different interpretation of the company’s financing terms per the financier.

The interpretation includes Evolva’s currently open financing lines and the company is looking to secure finances until the end of 2023. The company’s board of directors withdrew all previously provided predictions regarding the business’ performance and expectations for 2023.

According to Evolva, the current agreement with its financiers includes open lines of CHF 12 million (US$13.3 million), but the financing partner has informed Evolva about its interpretation of the financing terms and issued a letter of intent to Evolva to solve the terms’ interpretations.

The board plans to issue a strategic outlook along with the company’s mid-year results on August 24.

Unfolding situation
The discussions are ongoing and the company has emphasized that “there is no assurance that the parties will reach an agreement.” 

In light of the ongoing negotiations, Evolva’s board of directors initiated what it states is a “comprehensive review of strategic alternatives” in order to facilitate strategic transactions with other partners.

Evolva states it has entered into negotiations with Nice & Green to reach an agreement that benefits the company and its stakeholders and will inform them of the outcome at the appropriate time.

Recent growth
Evolva has experienced significant growth since procuring a new CEO early last year. Its board of directors highlights several recent achievements, noting that its gross contribution margin soared to 16% in 2022 – up from negative 59% the year before.

The company also came under a sanctions investigation by the SIX Exchange Regulation in the middle of 2022 for “significant errors in the presentation of the financial years of 2019 and 2020 in the annual accounts.”

At the same time, it secured a US$39 million multi-year agreement with a contract manufacturing organization for its fermentation-based vanillin for fragrances.

Evolva further states that it is “confident regarding its mid-term prospects” yet acknowledges that the current financing situation presents “significant challenges” for the company going forward.

Edited by William Bradford Nichols