Amyris Inc (NASDAQ:AMRS): Big Gains from New Partnership


Shares in biotechnology company Amyris Inc (NASDAQ:AMRS) gained 5.84%, closing Thursday at $0.81 on volume of 45.58 million after the company announced what it called was a transformative partnership with an unnamed company, a leader in food ingredients and nutraceuticals.

The transaction follows on an earlier announcement in September regarding a strategic partnership with a different company, also a global nutraceutical market leader, and similarly unidentified by Amyris due to the competitive nature of the market.

Amyris Inc (NASDAQ:AMRS) will gain cash and revenue from the new partnership

Subject to requisite approvals and execution of agreements, Amyris will receive an immediate cash infusion (“short term collaboration investment”) of $10 million, to be followed up by an equity investment of up to $20 million at $1.40 per share.

Additional benefits for Amyris include a revenue share of $100 million commencing 2017, related to production and cost improvement of fermentation molecules, as well as participation in the partner’s industrial fermentation facilities in Asia.

“Our current annual revenue run rate of over $100 million combined with the $100 million of annual revenue we expect from this partnership starting in 2017, should help us deliver stronger than expected growth in 2017 and beyond,” said John Melo, Amyris President & CEO.

Amyris Inc (NASDAQ:AMRS) technically very bullish

A reference to the company’s daily chart shows the formation of a saucer pattern commencing April this year and high-volume accompanying the rise on the right-hand side of the saucer pattern.

Yesterday’s gains pushed the stock well above its 200 day simple moving average at one stage, though the stock finally closed a whisker below the line.

The volume accompanying the saucer pattern suggests heavy accumulation.

Amyris Inc (NASDAQ:AMRS)’ long-term outlook

“We believe the combination of this collaboration and the strong momentum in our underlying business will provide us with what we believe is the largest pipeline of contracted fermentation-based molecules in the world, deliver the highest revenue growth rate in our sector and make us one of the fastest-growing companies in nutraceuticals and food ingredients,” said Melo.


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