June 21, 2007

Diversa and Celunol merge diversified industrial enzyme portfolios

Two dynamic cellulosic ethanol development companies have completed their merger transaction and are now renamed "Verenium Corporation." Both companies received investment backing by Khosla Ventures.

Massachusetts-based Celunol has distinguished itself as an innovator of a bacterial fermentation process for the conversion of glucose to ethanol. They have been participating in the commercial-scale development of wet bioconversion facilities using wood scraps as feedstock in Osaka, Japan and a demonstration plant in Jennings, Louisiana for the bioconversion of sugar cane bagasse (shown in picture).

San Diego-based Diversa is best known for its development of enzymes to convert pre-treated cellulosic biomass economically to mixed sugars – a critical step in the process of biofuel production. They claim to possess the world’s broadest array of enzymes derived from bio-diverse environments as well as patented DirectEvolution® technologies (state-of-the-art gene evolution technologies that enable the optimization of proteins at the DNA level).

Diversa and Celunol Complete Merger to Create Verenium Corporation, a Leader in the Emerging Biofuels Industry

CAMBRIDGE, Mass. and SAN DIEGO, June 20 /PRNewswire-FirstCall/ -- Diversa Corporation (Nasdaq: DVSA) and Celunol Corp. announced today that they have completed their previously-announced merger transaction to create a new leader in the global biofuels industry. The combined company, which has been renamed Verenium Corporation, possesses a growing portfolio of specialty enzyme products and unique technical and operational capabilities designed to enable the production of low-cost, biomass-derived sugars for a multitude of major industrial applications. The most significant near-term commercial opportunity for Verenium will be the large-scale commercial production of cellulosic ethanol derived from multiple biomass feedstocks. In connection with the corporate name change, the Company has also changed its NASDAQ ticker symbol from "DVSA" to "VRNM" and will begin trading under the new ticker symbol effective June 21, 2007.

Stockholders of both companies approved the merger and merger-related proposals earlier today, and all regulatory approvals and closing conditions have been satisfied.

"We are pleased that our respective shareholders have approved our merger and believe their support reinforces our belief in the compelling investment proposition afforded by this transaction," said Carlos A. Riva, President and Chief Executive Officer of Verenium. "After several months of diligent integration planning between the two companies, we are excited to become a single organization and are confident that the transaction represents a unique opportunity for our partners, employees, and shareholders."

"Verenium is now positioned to be a vertically-integrated leader in the rapidly-evolving worldwide biofuels industry through the unique combination of assets, technologies, and personnel resulting from this merger. We believe that commercial success in this industry requires broad R&D capabilities and asset development expertise, which we have now brought together within one, highly-focused company, Verenium Corporation."

Verenium begins operations with numerous unique attributes, including:
• Fully-integrated, end-to-end capabilities in pre-treatment, novel enzyme development, fermentation, engineering, and project development;
• One of the only operational cellulosic ethanol pilot plants in the United States;
• A 1.4 million gallon-per-year demonstration-scale facility, currently under construction, to produce cellulosic ethanol from sugarcane bagasse and specially-bred energy cane;
• A diverse and growing portfolio of commercialized industrial enzyme products; and
• Over 300 issued or in-licensed patents for its technologies and processes, as well as over 450 pending patents.

Verenium will be structured and managed as three distinct, but interdependent, organizational units: Specialty Enzymes Business Unit, Biofuels Business Unit, and Research and Development.

1. The Specialty Enzymes Business Unit currently generates commercial revenue from multiple sources, including industrial enzyme product sales, technology licenses, strategic partnerships, and government grants.

2. The Biofuels Business Unit will be primary focused on the commercial-scale production and sale of cellulosic ethanol from company-managed production facilities throughout the US, as well as strategic partnerships and related revenue arrangements around the world.

3. The Research and Development organization's primary goal will be to support both Verenium Business Units, as well as various existing strategic collaborative partners. As of March 31, 2007, the Company had cash, cash-equivalents, and short-term investments on hand of approximately $125.5 million, which, together with approximately $20 million received in early April from the exercise of an over-allotment option related to the recent convertible notes offering, it believes to be sufficient to fund operations through at least 2008.

Verenium's Board of Directors will initially consist of nine members, six from Diversa and three from Celunol, including Mr. Riva. The non-employee Board members are: Dr. James Cavanaugh, who will serve as Chairman of the Board of Directors; Peter Johnson; Fernand Kaufmann, Ph.D.; Mark Leschly; Melvin Simon, Ph.D.; Cheryl Wenzinger; Joshua Ruch; and Michael Zak.

The Company's executive management team is being led by Carlos A. Riva, President, Chief Executive Officer, and Director, and John A. McCarthy, Jr., Executive Vice President and Chief Financial Officer.

Verenium will be headquartered in Cambridge, Massachusetts and have research and operations facilities in San Diego, California; Jennings, Louisiana; and Gainesville, Florida. Due to the complementary nature of the two companies and the level of development activities being pursued, the company anticipates increasing its staff in Cambridge and Jennings, as well as building additional staff over time in San Diego to support the growth of the enzyme business and research and development efforts of the Company.

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1 comment:

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