AlgaeCytes Limited

Product: 
Technology Growth
Status: 
Open
Sector: 
Energy & Resource Innovation
Aim of funding: 
Growth
HMRC Advance Assurance received: 
Yes

AlgaeCytes Limited

Description: 

Algaecytes Limited has developed a proven innovative approach to the production of Omega 3 fatty acids, which are polyunsaturated fatty acids used in numerous bodily functions, such as controlling blood clotting and building cell membranes in the brain. Associated with many health benefits, including protection against heart disease and possibly stroke, new studies are identifying potential benefits for a wide range of conditions including cancer, inflammatory bowel disease and other auto-immune diseases such as lupus and rheumatoid arthritis.

Whilst Omega 3 can be sourced from oily fish, marine algae and certain plants and vegetables; 85%-90% of Omega 3 manufactured is currently derived from oily fish stocks. Algaecytes Ltd has developed a patent protected proprietary strain of freshwater algae that produces Omega 3, which offers a viable substitute in place of rapidly-depleting fish stocks. Furthermore, the Omega 3 derived in this way also meets increasing consumer demand for a taste-neutral product.

In view of the perceived health benefits of Omega 3, world food agencies are now considering putting in place Recommended Daily Intakes for Omega 3 in numerous foodstuffs. Food and drink manufacturers are also increasingly including Omega 3 as an ingredient in their products: the global market for Omega 3 products is projected to reach US$34bn by 2016 (Source: Frost & Sullivan, 2012).

Opportunity: 

The sustainable advantage of the freshwater algae developed by Algaecytes is that it can use the nitrates and phosphates present in discharged water from a wide range of manufacturing companies, as feedstock to produce Omega 3. Also, manufacturing companies are coming under increasing EU and UK legislation to reduce the levels of nitrates and phosphates in discharged water. 

The business model of Algaecytes Ltd is twofold: the production of high-purity Omega 3, and the treatment of process water discharged from industrial processes. The Algaecytes solution is very attractive as it not only reduces the nutrient levels but also provides an attractive additional revenue stream and cost reduction to the user, as an alternative to costly mechanical filtration methods.

We envisage an exit for our investors via a trade sale within four years, targeting a return of around 4-5x capital invested. The global Omega 3 market is currently dominated by less than 30 companies of which a small number are producing highly-refined pure products and it is highly likely that once Algaecytes first plant is successfully operating there will be considerable interest in acquiring the Company and its unique technology, algal strains, and industrial processes.

Information on this webpage relates to and is provided by Deepbridge Advisers Limited.

The content of this webpage should not be construed as financial advice. Any decision to invest should be made only on the basis of the relevant documentation for each investment. Past performance is not necessarily a guide to future performance. The value of an investment may go down as well as up and investors may not get back the full amount invested. Investments in small unquoted companies carry an above-average level of risk. These investments are highly illiquid and as such, there may not be a readily available market to sell such an investment. Deepbridge Capital LLP, Deepbridge Advisers Limited and Enterprise Partners LLP (together "the Sponsors," or "Sponsor) do not provide specific individual advice on the suitability of investments with regard to a potential investor's individual circumstances, risk tolerance or investment objectives and investors should seek independent financial advice if they are in any doubt whether a product is suitable for them.