German chemical giant Bayer has acquired a majority share of US pennycress start-up company CoverCress Inc (CCI) after signing a shareholders’ agreement with Bunge and Chevron, Bayer announced.
Under the agreement, Bayer acquires a 65% majority share of CCI, with Bunge and Chevron retaining a 35% share, according to the 1 August statement.
By using breeding and gene editing, CCI converted field pennycress, a winter annual weed, into the CoverCress crop that fits into existing corn and soyabean rotations, Bayer said.
Adding a new, marketable crop into rotation on existing land during winter can provide farmers with additional revenue while also providing cover, reducing nitrogen loss and improving overall soil health, according to the company.
In May, Bunge and Chevron announced a joint venture to produce feedstock to supply the renewable fuel industry with both companies acquiring a stake in CCI.
The new company, Bunge Chevron Ag Renewables, develops renewable fuel feedstocks, with Bunge contributing its experience in oilseed processing and farmer relationships and Chevron contributing fuel manufacturing and marketing services.
Under the commercial partnership between CCI and Bunge, CCI supplied CoverCress grain produced under contract with farmers to Bunge for processing, while the strategic partnerships between Chevron, Bunge and CCI created a dedicated farm-to-fuel supply chain for the low carbon intensity oil feedstock produced from CoverCress grain, the companies said on 2 May.
This farm-to-fuel supply chain represented by CCI, Bayer, Bunge and Chevron aimed to give corn and soyabean growers another revenue outlet, Bayer said.
“CoverCress… has the potential to become an important source for biofuel production as a new harvested rotational crop, while giving growers an… option to continue effective stewardship of their land and improve soil quality by acting as a cover crop,” Rodrigo Santos, member of the board of management of Bayer AG and president of the Crop Science Division, said.
Following the agreement, CCI would continue to operate as an independent entity, Bayer said.