INDOOR AG FIRM LOCAL BOUNTI TO GO PUBLIC, VALUED AT $1.1 BILLION, CARGILL IS MAJOR INVESTOR
Jun. 21, 2021
Local Bounti reports:
Hamilton, MT - Breakthrough U.S. indoor agriculture company Local Bounti Corporation (Local Bounti) has agreed to go public through a merger with Leo Holdings III Corp. (Leo or Leo Holdings) (NYSE: LIII), a publicly-traded special purpose acquisition company, pursuant to a definitive business combination agreement. The transaction values the combined company at an equity value of $1.1 billion (assuming no redemptions) and upon closing of the transaction, the combined company is expected to remain listed on the New York Stock Exchange under the symbol "LOCL".
Strategic partners include food and agriculture industry giant Cargill and Sarath Ratanavadi, CEO of Gulf Energy Development Public Company Limited − Thailand's largest private energy and infrastructure company and one of the world's leaders in sustainable energy − which are investing in the combined company through a private investment in public equity (PIPE) arrangement.
Cargill is also expected to provide $200 million in debt financing to accelerate Local Bounti's expansion plans. Local Bounti plans to use the capital to build local strategically-located indoor farming facilities across the Western U.S. to provide fresh, superior-tasting, long-lasting and sustainably-grown produce with minimal carbon footprint.
Local Bounti Investment Highlights
• Superior unit economics, with high yield and low-cost operations, enabled by unique hybrid facility configuration that addresses the challenges of conventional greenhouse and vertical farming
• Producing leafy greens today at initial facility with pipeline to grow to eight facilities and the company expects to have over 30 SKUs by the end of 2025, which extends Local Bounti's penetration, beginning in the largely untapped Western U.S. market
• Superior brand and product that is local and sustainable across a growing number of SKUs, currently in more than 400 retail stores, including Associated Food Stores and URM served retail banners such as Rosauers, Super 1 Foods and Yoke's
• Strong commitment to Environmental, Social and Governance (ESG) practices and standards, including an executive team member who is Global Reporting Initiative (GRI)-certified to ensure aggressively transparent reporting per GRI and Sustainability Accounting Standards Board
• Best-in-class, established management team of seasoned veterans at scaling early-stage companies, with Fortune 500 and public company experience
"Today's announcement takes Local Bounti to the next level in enabling local, sustainable production and delivery of fresh, delicious and nutritious produce, including in regions that traditionally don't have access to local supply, starting in the Western U.S. and expanding globally," said Local Bounti Co-Founder and Co-CEO Craig Hurlbert. Based on publicly available market research on CEA, Local Bounti believes the current Western U.S. market opportunity is approximately $10.6 billion, and estimates that the total U.S. market for vegetables and herbs will reach up to $30 billion by 2025.
"We look forward to leveraging our proven business model as we accelerate the building of cutting-edge local production facilities that feature our proprietary IP, referred to as Stack & Flow Technology, and transforming conventional agriculture practices for the benefit of all our customers, no matter where in the world they're located," he said, adding that the company's growth plans include adding seven new facilities and local leadership in different geographic regions, as well as global expansion of its proprietary technology.
An industry disruptor changing the way food is grown and re-imagining the Farm of the Future, Local Bounti is a premier controlled environment agriculture (CEA) company redefining ESG standards for indoor agriculture. The company's unique business model is based on building local facilities, operated by local teams, to deliver the freshest and highest quality produce to local communities while maintaining a limited carbon footprint.
Using proprietary technology to grow leafy greens and herbs in a smart, indoor controlled environment − and with a cultivation process that uses 90 percent less water and land than conventional agriculture, free from herbicides or pesticides − Local Bounti delivers high-quality produce that not only has a longer shelf life, but is also superior in taste.
"Local Bounti is set to be a transformational force in the AgTech industry with its demonstrated concept and model in food production and distribution," said Lyndon Lea, President and CEO of Leo. "Combining Local Bounti's emphasis on innovation, entrepreneurial spirit, and technology-driven approach with the institutional knowledge of the Leo Holdings team, we are confident in the company's ability to expand in both reach and consumer offerings."
Leveraging its innovative proprietary modular and scalable building system, which is designed to easily and efficiently replicate the company's sustainable indoor farm model, Local Bounti is more than doubling the size of its flagship facility in Hamilton, Montana, and plans to break ground on additional facilities in the Western U.S. before the end of this year.
To learn more about Local Bounti's unique growing process, diversified product offerings and experienced leadership team, please visit localbounti.com.