Agronomics puts another $0.5m in cultivated leather firm VitroLabs

The AIM-traded firm said VitroLabs had made “substantial” technical and commercial progress in the past year, reaching milestones around production cost reduction, consistent leather quality, increased platform production capacity and process efficiency, as well as securing key partnerships.

It said the subscription was in the form of a convertible loan note, which would convert at VitroLabs' next funding round.

Agronomics previously invested $2.5m in total in the form of two simple agreements for future equity (SAFEs), with the first in October 2019 and the second in February 2020.

The approximate equity ownership on conversion at the valuation cap of the note and the SAFEs for Agronomics would be about 5.25%.

It said the subscription would be paid using cash from the company's own resources.

The board said the follow-on investment did not result in a change of the carrying value of its existing investments in VitroLabs.

“We are glad to continue to support Ingvar and his team as VitroLabs moves from being research and development centric, towards commercialisation,” said chairman Richard Reed.

“Just as consumers are paying more attention to the environmental footprint of their food consumption, the same goes for fashion.

“The major global fashion houses are acutely aware of this shift, but until now have had no credible alternatives that perform at the level required to replace conventionally farmed leather.”

At 1442 GMT, shares in Agronomics were up 1.06% at 18.19p.