TerraVia Sells Stake in Algenist

TerraVia has entered into a definitive agreement to sell a majority interest in the Algenist skincare brand to Tengram Capital Partners. As part of the transaction, Tengram and TerraVia have also formed a partnership focused on leveraging TerraVia’s innovative algae-based ingredient platform and Tengram’s brand-building and investment expertise to pursue compelling new opportunities in the beauty industry.
 
Algenist, launched by TerraVia (then known as Solazyme) in 2011, delivers anti-aging and color correcting innovation based on a suite of proprietary algae-based ingredients including Alguronic acidand microalgae oil. The brand has won broad market recognition, including the prestigious Marie Claire Prix D’Excellence de la Beaute in 2014, and the 2015 Beauty O-wards by O, the Oprah Magazine, and has achieved a global distribution footprint across 23 countries and including major retail channels like Sephora, ULTA and QVC.
 
“Algenist is a unique brand in the prestige skin care market, with a distinct positioning and unique and proprietary ingredients. The recent bridge into color cosmetics leveraging the patented ingredient technology creates tremendous potential for the future growth of the brand,” said Richard Gersten, a partner at Tengram. “We are looking forward to working with the existing team and leveraging our beauty industry expertise to drive continued growth across all global markets. We are also excited about the broader partnership with TerraVia and believe that there are great opportunities to create value.”
 
“Having started the brand with Jonathan and the TerraVia team back in 2011, I am thrilled to lead Algenist as its CEO at this exciting time in the brand's development. The partnership with Tengram and TerraVia will help continue to build upon the brand’s current momentum,” said Algenist’s Frederic Stoeckel.
 
Upon the close of the transaction, TerraVia will retain an ownership interest in Algenist of approximately 20% and will continue to supply active ingredients formulated in the Algenist product line. As part of the transaction, Tengram will also contribute significant capital to the business to accelerate broader commercialization. At close, TerraVia will receive approximately $20 million.
 
As part of the agreement, Tengram and TerraVia have also agreed to create a partnership focused on identifying additional opportunities to utilize algae-based ingredients across all segments of the beauty industry. By leveraging TerraVia’s innovative suite of algae-based technology that have been validated by major consumer packaged goods companies, combined with Tengram’s beauty industry expertise and outstanding track record in brand-building, the partners will target Tengram-led opportunities to invest behind beauty and personal care brands that would benefit from the differentiated positioning and compelling science offered by TerraVia’s algae-based ingredients.
 
“We are enthusiastic about our partnership with Tengram as we work together to help Algenist achieve its extraordinary growth potential,” said Jonathan Wolfson, co-founder, chairman and CEO of TerraVia. “This partnership allows us to focus our captive commercial operations on foods and nutrition, while maintaining participation in Algenist’s future success and gaining access to Tengram’s expertise and leadership to participate in beauty and personal care opportunities commercializing our proprietary algae platform.”
 
The transaction  is expected to close by the end of the third quarter of 2016 subject to customary closing conditions.