January 4, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

Sustainable food tech innovator Benson Hill is streamlining its business, having announced its agreement to divest its Fresh business unit in a two-part deal for an aggregate sale price of $21 million. 

Founded in 2012, Benson Hill leverages Cloud Biology®, or the combination of data science, machine learning, AI techniques, biology, and genomics, to unlock nature’s genetic diversity in plants to create innovative food and ingredient products.

The company manifests its seed to shelf innovation through CropOS™, its platform that uses predictive analytics to simulate tens of millions of genetic outcomes for plants, referencing an ever-expanding and unrivaled data library to make Cloud Biology® actionable.

This technology enables Benson Hill to accelerate and precisely develop more sustainable outcomes years quicker than traditional crop breeding systems through an approach that decreases development costs, shortens time to market, meets consumer demand, and links the interests of both the growers and consumers.

Under its structure, Benson Hill has been operating two business segments: Ingredients and Fresh. The Ingredients unit focuses on enhancing soybean and yellow pea ingredients for the rapidly growing plant-based foods segment, as well as animal feed and pet food inputs. Its Fresh unit has been working to develop novel fresh produce that meets demands of both growers and consumers with the goal of commercializing differentiated produce and “functional foods” that in the future would have the potential to unite the produce and pharmacy aisles.

Benson Hill noted that this decision to divest its Fresh business represents “the execution of an expected milestone” for the company as it turns its focus toward global opportunities for its Ingredients segment.

As such, Benson Hill closed on the first half of the transaction on December 29, 2022, which detailed the sale of its facility in Vero Beach, Florida, other real estate, and a packhouse to IMG Enterprises – a diversified agribusiness in Groveland, Florida, for $18 million.

The remaining assets associated with Benson Hill’s Fresh unit are expected to be divested to IMG Enterprises during Q2 2023 for an additional $3 million, pursuant to a stock purchase agreement. 

“The acquisition of these assets and business is a perfect fit for our future growth plans,” said Timothee Sallin, co-CEO, IMG Enterprises. “As a leading family-owned Florida agribusiness, our aim is to add value through vertical integration across the supply chain and diversification into new crops and market segments.”

“The cold storage and distribution facility in Vero Beach is ideally located for us to expand our operations and more efficiently service customers in the Southeast United States. The additional farmland will allow for further crop diversification and expansion of our core products.”

Benson Hill stated that it intends to use the capital from this divestiture to fully fund its remaining business including debt repayments, and to execute its previously announced strategic initiatives.

Next Level Soy

Innovation in soybean seed development over the past decades has focused more directly on improving yields, while protein content has decreased, according to David Iverson, United Soybean Board meal target area coordinator and South Dakota farmer.

However, Benson Hill’s seed-to-shelf innovation pipeline through its CropOS™ platform uses proprietary phenotyping, predictive breeding, and environmental modeling algorithms to allow Benson Hill’s plant breeders to optimize the protein content in its soy varieties, and to accelerate the path to market.

In March 2020, the company announced its plans to release new ultra-high protein soybean varieties for the 2021 season that would be the first commercially available soybeans to effectively replace soy protein concentrate via traditional soybean crushing. 

These varieties offer superior protein and oil profiles, greater feed digestibility ratios, low trypsin inhibitor levels, and other qualities sought after by high-volume end users. One such offering is the eMerge Genetics portfolio of products –  an internationally known portfolio of non-GMO soybean varieties that are non-GMO verified for sale in all markets, including the EU.

Then, as demand for plant-based protein ingredients continued to grow, Benson Hill  announced in September 2021 its acquisition of a soybean crushing facility in Seymour, Indiana, from Rose Acre Farms, representing a major step toward realizing its strategic growth plan. 

This facility will ultimately have the capacity to process Benson Hill’s proprietary soybean varieties, including the first commercial plantings of its Ultra-High Protein soybeans, which were expected to be harvested in 2021, after the company exceeded its target to double contracted soybean acres delivering a 133 percent year-on-year increase for the 2021 growing season. 

Commenting on the divestiture of its Fresh business, Dean Freeman, CFO, Benson Hill, said, “We’re pleased to bring this process to a successful close.”

“We believe there is tremendous opportunity to grow our proprietary ingredients portfolio in the food, oil and aquaculture markets. Selling the Fresh business enhances our focus and further enables disciplined capital allocation in support of our strategic growth objectives.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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