Plant Impact boosted by premium share deal with Arysta

Shares in environmental technology business Plant Impact were up more than 40 per cent this morning after its partner, Japanese agrochemical company Arysta LifeScience, agreed to pay a premium of more than 76 per cent to acquire 4.6 million shares in the company.

Tokyo-based Arysta, the world’s largest privately-held crop protection and life science firm with revenues of US$1.3 last year, paid 45 pence each for its shares compared with Plant Impact’s closing price of 25.5 pence last night.

Although Plant Impact also put out a profit warning today – stating that the loss for the year would be greater than previous anticipated due to a delayed milestone payment connected to its BugOil insecticide product – shares in the firm traded for more than 36 pence each. At 9.55am there were 37.35 per cent higher at 35 pence each.

The company has raised £2.1 million from the subscription, while Arysta now holds around 9.1 per cent of Plant Impact’s shares.

Plant Impact, which develops and sells products designed to improve the health of crops, has also signed two deals with Arysta.

The first covers the commercial development of Plant Impact’s PiNT technology in the ‘turf and ornamental’ markets in the US – including the large US professional golf market. The second covers the commercial development of both PiNT and InCa technologies for use in horticulture in Brazil.

Plant Impact plans to use half the new funds announced today to work with Arysta on the commercial development programmes outlined above.

The remainder of the funds will be used for product development, recruitment of new sales and development staff and to enable the company to carry out further product branding and marketing.

"I am delighted that Arysta Lifescience has chosen to invest in Plant Impact so that we can implement this growth strategy together. We feel that this shows industry confidence after several years of successful trials,” said Peter Blezard, Plant Impact’s CEO. “The proceeds from the subscription will give us the financial strength to continue the growth of other parts of our business."

Plant Impact’s PiNT products use a nitrogen-based technology that is eco-friendly and improves plant growth. InCa, the firm’s biggest selling product last year, is a calcium delivery system that enables plants to absorb and retain calcium in tissues where it is most needed.

In a trading update also announced today Plant Impact said that although revenues from the sale of its crop nutrients were in line with expectations, the ongoing regulatory approval review in the US of its BugOil insectide means that the firm did not received of £0.5 million milestone payment during the year ended 31 March 2011.

Consequently, Plant Impact expects its loss for the year to be greater than previously anticipated.