Melbourne, FL-based PetroAlgae has filed an S-1 document with the Securities and Exchange Commission in the hopes of raising $200 million from an initial public offering. Unfortunately, despite the promise that algae shows as a feedstock for biofuels, PetroAlgae doesn't appear to have much to offer.
Evidently, PetroAlgae has spent nearly $60 million to develop a process for speeding up the growth of algae that can be used as animal feed or for biofuel production. So far, PetroAlgae has a research facility in Florida but doesn't plan on actually producing algae for commercial use. Instead, the company wants to license its technology and has agreements with five other companies that will pay royalties to PetroAlgae only if its process is used.
So far, PetroAlgae has no revenues and no near-term prospects for profitability unless oil prices rise dramatically. It appears that investor Laurus Capital Management LLC wants to cash out while still allowing the company to have cash to fund operations for a while. Will it work? We'll see.
[Source: Florida Today]