Biofuel-catalyst developer Codexis nixed a plan this week to go public, citing poor market conditions.
The Redwood City, Calif., company had intended to raise up to $100 million when it filed papers with the U.S. Securities and Exchange Commission in April (see Funding Roundup: Dancing on the Edge of a Bubble?).
Codexis's decision reflected the softening economy and investors' bearish views of the public market.
A survey by the National Venture Capital Association and Thomson Reuters said there were no venture-backed IPOs in the U.S. market in the second quarter this year. And a number of venture capitalists have said they expect to see few successful IPOs in the next year and a half, in spite of an uptick in companies filing for them (see KPMG: VCs Expect Slow IPOs until 2010 and Angling for IPOs in Tough Times).
Codexis's decision also illustrated the tough times faced by the biofuel industry, which has seen many companies delaying or abandoning plans to build refineries over the past year (see Plans for Two Cellulosic-Ethanol Plants Scrapped, Ethanol Margins Suffer and Ethanol's Tough Times Continue).
It's the third biofuel-related company to withdraw its IPO this year.
In March, Renewable Energy Group, a biodiesel producer in Ralston, Iowa, canceled its plans to raise up to $150 million. In January, Seattle-based Imperium Renewables, also a biodiesel producer, set aside its ambitions for a $345 million IPO (see Imperium IPO Delay Underlines Feedstock Shortage, Analyst Says).
Codexis, founded in 2002, is developing enzymes for turning feedstock into biofuels. The company is also developing chemical processes for the pharmaceutical and water-treatment markets.
The startup already has raised at least $75 million in private equity, according to company announcements. Its investors include Bio*One Capital, Chevron Technology Ventures, CMEA Ventures, Maxygen, Pequot Ventures and Pfizer.
The Royal Dutch Shell has also invested an undisclosed amount in the company, which announced a five-year development deal with the oil giant last November.
Codexis inked a contract in 2007 to provide enzymes to Merck & Co. and a 2006 research agreement with Schering-Plough Corp.
Although the company opted not to raise money through an IPO, Codexis currently has no plans to raise more private money either, said Lyn Christenson, the company's director of corporate communications.
Despite the market downturn, a number of greentech companies have announced their intentions to go public in the last two months, including wind-power company Noble Environmental Power, solar-materials developer STR Holdings and battery firm A123Systems (see More Greentech Companies to Go Public).
Industry watchers such as Tim Carey, who heads PricewaterhourseCoopers' U.S. cleantech research, said last month that filing paperwork doesn't necessarily mean the companies will go public soon.