Dyadic agrees to sell industrial technology business to DuPont Industrial Bioscience for $75 million

Jupiter, Florida, November 10, 2015 (GLOBE NEWSWIRE) — Dyadic International, Inc. (OTCQX: DYAI) announced today that it has entered into a definitive agreement to sell substantially all the assets of its Industrial Technology business to DuPont’s Industrial Biosciences business (“DuPont”) for $75 million in cash (the “Agreement”). Following completion of the transaction, Dyadic intends to focus exclusively on its biopharmaceutical business.
Mark Emalfarb, Dyadic’s founder and CEO, said, “This transaction is an exceptional opportunity to unlock value and provide Dyadic operational flexibility to further develop our pharmaceutical business. We will now focus our C1 technology exclusively on the pharmaceutical sector where we believe it has the potential to help develop and manufacture drugs and vaccines faster and more efficiently than existing production systems.”
Dyadic will sell to DuPont substantially all of its enzyme and technology assets, including its C1 platform, a technology for producing enzyme products used in a broad range of industries. DuPont has granted back to Dyadic co-exclusive rights to the C1 technology for use in human and animal pharmaceutical applications, with exclusive ability to enter into sub-license agreements in that field. DuPont will retain certain rights to utilize the C1 technology for development and production of pharmaceutical products, for which it will make royalty payments to Dyadic upon commercialization.
“We are very proud of the C1 platform and our team responsible for its development over the past decade,” added Michael Tarnok, Dyadic’s Chairman. “We are pleased to be able to provide liquidity and increased value to our stockholders and look forward to building our pharmaceutical business.”
The Agreement provides for $8 million of the purchase price to be held in an escrow account for 18 months to ensure Dyadic’s obligations with respect to certain indemnity claims and working capital adjustments. Dyadic expects to utilize approximately $66 million of its net operating loss carryovers to substantially offset the gain realized from this transaction. Simultaneous with the signing of the Agreement, stockholders owning approximately 26.4% of Dyadic’s shares currently outstanding, including stockholders
affiliated with our Chief Executive Officer, entered into a voting agreement pursuant to which, subject to certain limitations, they have agreed to, among other things, vote the shares controlled by them in favor of the transaction.
Completion of the transaction, which is expected by the end of 2015, is subject to approval by a majority of Dyadic’s stockholders and customary closing conditions.
Houlihan Lokey acted as a financial advisor to the Board of Directors in connection with the transaction, along with Cahill Gordon & Reindel LLP and Abrams & Bayliss LLP who served as legal advisors.