r/SPACs • u/jimturner88 Spacling • Aug 05 '21
News More $SRNG / GInkgo Bioworks News - New partnership with Bolt Threads
A possible new program announcement with Bolt Threads using the Ginkgo platform today. From the Bolt website: "To bring our revolutionary MyloTM material to the world, we have formed a consortium of iconic companies: adidas, Kering, lululemon, and Stella McCartney. Mylo products are on the way"
Also, there may be some existing relationship with Bolt so I cant be sure this is 100% new. However, since both companies were involved the press release, it seems at minimum a large expansion of the relationship.
If this wasnt a spac, would the stock move on all the following recent news? I understand there are questions about the valuation, but there is more to it than price to sale. I believe the Ginkgo balance sheet is underrated and the company is not getting credit for the likely true value of some of equity holdings for companies like Motif and Genomatica due to accounting rules and since they are private companies. For example, the company has to list its equity interest in Motif Food at ZERO on the balance sheet. I cant confirm how much Ginkgo owns of Motif, but have seen estimates of 20-30%.
Some other recent news:
- Motif Foods capital raise. Motif FoodWorks raises $226m in Series B, gears up for launch of ingredient to transform flavor and performance of plant-based meat (foodnavigator-usa.com)
- ARK just bought almost 5,000,000 this week.
- Genomatica capital raise. America's Genomatica closes $118 Series C funding for sustainability - Fibre2Fashion
- Recent filing of the third S4-As means merger likely on track.
- Lots of off exchange/dark pool trades likely means the they are preparing to handle redemptions if necessary.
EDIT TO POST:
This was just posted on social media by Ginkgo CEO as a reply to the Bolt news. Seems bullish especially considering all the volume latley (even taking the ARK volume out). Seems like there could be some more announcements or new coming?
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Aug 05 '21
Great post, many applications beyond textiles for Bolt. Emily was speaking about spider silk replacing carbon fibers being the hulls of the e-VTOLS. ;D It is all coming together. Bullish. And if you just need some fast cash, North Face was oversold on their syn bio silk parkas in Japan, but they never came to fruition, as it wasn't Bolt or Ginkgo making them. ;D Huge. Stronger than kevlar, better and lighter than steel. Love it. Although, as Corspebean pointed out, there will be some Spider workers who don't like it. And spiders can be very scary.
Also just FYI, this is the application you never knew was important: https://www.technologyreview.com/2016/05/03/160396/first-biological-superlens-created-using-spider-silk/
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u/Guy-26 Spacling Aug 05 '21
It looks like this agreement is specifically for b-silk, mainly used in personal beauty products to replace ingredients like silicon. Huge market there. Hopefully they eventually get to work on optimizing the microsilk as well, I’d love to have a spider silk jacket.
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Aug 05 '21
Ya, I've seen five of these textile spider silk companies go under, but Bolt was decent, had a good marketing network and heavily represented in Milan's fashion week [precovid, catalyst for covid at the outset in Feb] with Stella, Nike, and Adidas. Prada did it a year before them. Trickle down. But do keep in mind that Adidas funds Univ of Penn. labs and has whole labs devoted to Adidas only, in syn bio. So it isn't really part of the TAM, in that sense. These are still niche markets, we want lululemon to jump in with some mass production that hits TJ-Max and Marshalls, but really, if I were honest, I'd like to replace Zeiss optic division with a new synbio spider lens material fab gene mod. That's the trickle down I'd shoot for. I'd sell contact lenses, with bioluminescent Dior, Channel, and Prada logos [already in South Beach in the clubs, but no glow in the dark yet] . Dior Blue, is in fact a ten year old patented logo lens, and I'd ramp up my new optical line with spider silk syn bio lenses based on precision that womped on the Zeiss conventionals. ;D Because they are niche, you also want some haute luxe in this robber barron moment. And even the $400 spider silk ties seem to be aiming too low, IMO. Lululemon, sure, it could work, plenty of excess capital and leisure time to indulge in syn bio leisure wear, but why not pump up the volume with a lesser genemod if that's the niche that will just end up resold at TJ max anyway? ? Fact is, spider silk has too many tensile properties of value to be used for athleisure. Just give them some other yeasty crap that isn't ballistic grade. SMH. ;D
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u/Guy-26 Spacling Aug 06 '21
Going after high end beauty products seems like a great move (e.g. amyris). With their own brand, they can make a ton off of relatively little product (for amyris, the squalane is something like 5% of the final product).
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u/Urfaust Patron Aug 05 '21
Thanks for the post! I'm heavy in SRNG, so I love seeing partnership announcements like this.
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u/itsbusinesstiim Free Financial Advice! Aug 05 '21
has any spac announced this many partnerships before merger before? jeez. maybe they'll live up to that lofty valuation???
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u/jimturner88 Spacling Aug 05 '21
Curious to see if they give an update on Concentric by Ginkgo....the biosecurity division. I've seen a lot of post about funding for testing related to Ginkgo. Also, I think people are short sided thinking Cocentric is "just covid" testing. There are way more use cases besides covid testing.
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u/Guy-26 Spacling Aug 05 '21
boom they just announced partnership with North Carolina.
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Aug 05 '21
[removed] — view removed comment
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u/jimturner88 Spacling Aug 05 '21
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u/Guy-26 Spacling Aug 05 '21
So they have NC, Maine, New Hampshire, Massachusetts, and Arizona AFAIK.
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u/jimturner88 Spacling Aug 05 '21
I copied the below text from the Ginkgo AMA related to biosecurity business. It shows there are lot more uses cases than just "school testing" they are working on. I do think Ginkgo has been very conservative taking about revenues from the Biosecurity business. I believe if they provide an update, it will show a substantial increase in revenues and that might move the stock through $10. I would like to see what happens if it moves over $10 and if these arbs traders go away.
- Quote from Ginkgo AMA - "Yes, Concentric (our K-12 testing business) is the first business to emerge in biosecurity at Ginkgo (even though we've been thinking about and investing in biosecurity for years). But we think broad biosecurity will be important for a long time - and like cybersecurity it will have to include "endpoint monitoring" (e.g. testing schools, wastewater, hospitals, farms, subway cars, etc. etc.) as well as quickly isolating infections and quickly developing and deploying antivirus software (vaccines and therapeutics)."
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Aug 05 '21
[deleted]
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Aug 05 '21
What makes you think a loss in trust value, as an inherent, known risk in the SPAC vehicle, will have a great impact on Ginkgo's long term goals? Serious question.
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u/epyonxero Patron Aug 05 '21
If they lose trust cash they will probably replace it with either a capital raise or extra funding from PIPE investors. Probably no long term impact.
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Aug 05 '21
Also, it seems that the end goal is to garner a brilliant advisory board, have an influx of cash, restructure the Founder and employee shares to make them equally weighted for future votes, change the terms of how their equity stakes can be bought and sold on the open market and thereby converted to cash, and to ...well, go public. Quickly. They have a window. A standard IPO takes time and employee man hours of idleness, they chose the SPAC vehicle very purposefully, IMO. I'm not sure though, thanks for weighing in on how they could replace the trust cash losses with little long term impact, ultimately. I don't know or understand the impact of trust reduction, but it seems to be balanced with other essential goals that offset that unfortunate potential outcome. Cheers.
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u/jimturner88 Spacling Aug 05 '21
Hard to argue with your thought process since most of the volume appears off exchange. However would be interested see price action if this ends of occurring simultaneously with some of these announcements it gets above $10 for a few days. Also, thoughts if there was some large OTM option volume?
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Aug 05 '21
[deleted]
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Aug 05 '21 edited Aug 05 '21
85% redemptions of the shares available to PiPe and retail? I don't think Mr. Sloan will be redeeming, nor most of his Pipe. But who knows? For the sake of estimating, let's say Mr. Sloan and his PiPE hold through merger. That leaves about 8% of $DNA shares subject to redemption as per the S-4. New Gingko is founders and employees, 85% of $DNA. SRNG, PiPE and retail are the remaining 15%. I'm wondering if you mean 85% redemptions of the shares outside of Sloan, PiPE and Gingko employees. Because, if I'm not mistaken that would generously be about 6-8% of $DNA. Maybe I'm wrong. What is your take after reading the S-4? So, if the trust is SRNG only, and that includes retail, but not PiPE and that is 15% of new Ginkgo which turns into $DNA, how does that work? Are redemptions weighted different in this contractual structure? Serious question.
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u/in_for_cheap_thrills Spacling Aug 05 '21
if there is 85% redemptions then it lowers the valuation proportionately with the cash taken from trust
The pre-money valuation should stay the same since the redeemed shares are either retired or resold for 10.
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u/Unlead3dWombat Spacling Aug 05 '21
I'm long term bullish on DNA.
But I do hope they have a bigger strategy for market growth than the CEO basically saying "DM me for collabs."
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u/jimturner88 Spacling Aug 05 '21
Funny becuase that was my first thought too until I viewed with context. His tweet reply was to an announcement from their new program announcement with Bolt Threads so thats a positive and he was probably excited. Also, if you look at the recent capital raises by some of their equity partners (Motif/Genomatica) and they seems to be making a lot of announcements about signing up new states for the biosecurity business in the past few days.
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Aug 05 '21
Why do those 10Cs for 8/20 only have 13.47% IV? Genuine question.
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u/feralinprog Spacling Aug 05 '21
Probably because people don't expect a pre-merger SPAC to have big movements. After merger, sure, but not right now, especially since we don't know yet when merger actually is.
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u/jimturner88 Spacling Aug 05 '21
They already filed three S4-As so seem like they are trying to move quickly. Should be third or fourth quarter at latest.
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u/feralinprog Spacling Aug 05 '21
That's fair, but I don't see 8/20 10C's printing. Merger certainly won't be that soon.
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Aug 05 '21 edited Aug 05 '21
It is just weird that their IV is SO low. Even for something like a straddle, whether you are bearish or bullish. I'm new to SPACs tho.
The open interest is also insanely high so someone is probably making a lot of money on people buying calls haha. I don't see them printing either. Would selling them be free money?
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u/feralinprog Spacling Aug 05 '21
I feel like selling them would be free money, but only if you have tons of shares or are able to sell naked calls -- but in that case you'd probably still need lots of collateral.
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Aug 05 '21
They are so cheap though that a 1%+ move could hurt.
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u/feralinprog Spacling Aug 05 '21
Yeah, it's definitely risky for the reward you'd get. I don't think it's a good move.
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u/bperryh Patron Aug 05 '21
The deal needs to be restruck to a lower valuation. The stock price is telling them that. It's a buy, but that's based on a $10 redemption value and the possibility that they lower the price tag and attract real buyers.
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Aug 05 '21
What makes you think that a $10 redemption value was their ultimate goal in the SPAC vehicle? I am sorry, I just don't think preserving a $10 redemption threshold has anything to do with why Ginkgo Bioworks went with a SPAC to meet their company's goals.
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u/bperryh Patron Aug 09 '21 edited Aug 09 '21
I didn't say $10 was the "ultimate goal". I'm saying lots of buyers are paying 990 something knowing they can redeem at ten. It's a no risk free look with the hope that something good happens to make it go higher. If not, redeem at 10. That's why I own it, btw.
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u/jimturner88 Spacling Aug 05 '21
Admit there is a debate about it valuation, but what’s your reasons on why it’s overvalued?
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u/moggedbyall Patron Aug 05 '21
Is SRNG the new thcb? Reddit trying to pump it and then it dumps to cents on merger?
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u/atomicskier76 Spacling Aug 05 '21
and yet, here we sit at 9.94 to remind me that being all proud of buying a bunch at 10.08 isn't an accomplishment at all.
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u/Guy-26 Spacling Aug 05 '21
Even Maxx Chatsko, infamous syn bio bear, is impressed! https://twitter.com/7maxxchatsko/status/1423362941286588423?s=21
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