Wide Open Agriculture has signed a non-binding term sheet with Ingå Group, a UK firm that develops clean, functional and sustainable ingredient solutions for the food industry. Ingå is proposing to invest €500,000 in Wide Open Agriculture Germany GmbH.
The term sheet outlines the terms of the proposed investment, including the execution of a distribution agreement, the details of which will be finalised in the coming weeks.
Ingå is a subsidy of Axel Johnson AB, a leading Swedish family owned business that builds and develops long-term businesses that address societal challenges in areas such as food, energy, health and industry, with the aim of being a positive force for change.
Axel Johnson’s portfolio of companies generated 2022 net sales of SEK$118 billion (A$17.1 billion), and collectively employ over 25,000 people around the world.
Proposed investment agreement
The material terms proposed under the non-binding term sheet is as follows:
Ingå will invest €500,000 in Wide Open Agriculture Germany GmbH, a subsidiary of Wide Open Agriculture Limited. The investment will result in Ingå acquiring an estimated 15 per cent stake in Wide Open Agriculture Germany GmbH, at a pre-money valuation of €2.9 million. The remaining equity in Wide Open Agriculture Germany GmbH is owned by Wide Open Agriculture.
The investment will be used to fund ongoing working capital requirements and will allow for faster scaling of capability in Germany.
An advisory board, consisting of up to four members, will be formed to provide strategic guidance to the management of Wide Open Agriculture Germany GmbH. Both Ingå and Wide Open Agriculture Germany GmbH will have equal representation on this board, although it will not be involved in day to day decision making.
Execution of a distribution agreement whereby Ingå has exclusivity to market and to sell WOA's lupin based protein products across Europe. Execution of an IP exclusivity agreement that provides Ingå with part ownership of the former Prolupin IP that was purchased as part of the asset acquisition agreement.
The proposed investment is conditional on the successful completion of due diligence, any approvals required (including, if applicable, board, shareholder and regulatory approvals), and the execution of associated legal documents, including the IP exclusivity agreement and distribution agreement.
Proposed distribution agreement
Under the non-binding term sheet, both companies will also work towards formalising a binding agreement whereby Ingå will exclusively market and sell WOA’s lupin based protein products, including Buntine Protein, across Europe.
A final distribution agreement is expected to be formalised and signed by 31 December 2023. The distribution agreement is not expected to contain a minimum purchasing commitment but is expected to have other terms that are standard in commercial distribution agreements of this type.
CEO of Wide Open Agriculture, Jay Albany said Ingå was an ‘ideal partner’ for WOA’s European venture.
“Ingå’s investment and belief in our vision will empower us to scale new heights, with an impressive track record and commitment to sustainability. We are excited to leverage their expansive network and expertise to bring Buntine Protein to new markets,” said Albany.
Adrian Short, CEO of Ingå Group said the investment goes beyond financial implications.
“It’s about fostering a sustainable food ecosystem and supporting Wide Open Agriculture’s potential to be a leader in this space. We are committed to helping them expand their footprint in Europe and beyond,” said Short.
