Genetic Engineering of Crops – Kaiima raising $50m
The company can create bigger plants that are richer in nutrients, able to photosynthesize faster and survive in extreme and drought conditions
Genetic engineering seed company Kaiima Ltd. is in the final stages of a financing round from Asian investors, including Horizon Ventures of Hong Kong billionaire Li Ka-Shing, the chairman of Hutchison Whampoa Ltd. (HKSE: 0018). The World Bank has pledged up to $20 million out of the $50 million that Kaiima plans to raise.
Kaiima develops improved varieties of crops using a proprietary “advanced ploidy” technology to replicate a crop’s genome, not modifying it through genetic engineering. The company says that it can create bigger plants that are richer in nutrients, able to photosynthesize faster, survive in extreme and drought conditions, and generate more seeds for the faster propagation of the next generation.
Kaiima’s capabilities have been demonstrated with various crops, but it currently focuses on rice, corn, wheat, rapeseed (an alternative to canola), and the castor oil plant. Caster oil is a leading biodiesel product, and the company already sells a variety with higher oil concentration (double the amount of oil per hectare, it says).
Genetic engineering of crops has been gaining ground among Israeli start-ups. Evogene Ltd. (TASE ;EVGN) has major cooperation agreements with Monsanto Corporation (NYSE: MON), Dupont (NYSE: DD) unit Pioneer Hi-Bred, and Syngenta AG (SWX: SYNN; NYSE: SYT); and Rosetta Green was acquired by Monsanto earlier this year for $35 million.
Kaiima uses a different business model and has no cooperation agreements with the seed giants. Instead, it has raised, and continues to raise, substantial amounts of capital, apparently in order to bring products to market independently, as it did with rapeseed.
Kaiima is currently focused on China, which is apparently why it approached the investors mentioned above. The company is also targeting India, and it plans to collaborate with the Indian government. Over the coming year, it plans to find a distributor in India and China, produce its own products, and launch large-scale sales a few years later.
Kaiima was founded in 2006 by CEO Dr. Doron Gal, who has a doctorate in Geophysics from Stanford University.