We announced in September 2021 that we entered into an asset purchase agreement with Butamax Advanced Biofuels LLC and its affiliate, Danisco US Inc., to acquire certain patents. This agreement means that Gevo is the only entity with full rights to sublicense the entire Gevo/Butamax isobutanol and isobutanol derivatives patent estate.
We’re invested in isobutanol-related technologies, and so it fits our business model to hold the rights to these patents. The patents are in the fields of fuels, isooctane, industrial chemicals, isobutylene, oligomerized isobutylene, and para-xylene. Acquiring these patents gives us more flexibility in adding to the combined patent estate and eliminates the complexity related to out-licensing under our previous greement. The transaction contemplated by the Asset Purchase Agreement closed on September 21, 2021 and is subject to certain existing rights and obligations.
The agreement provides Gevo with direct ownership and management over the entire known isobutanol patent portfolio of Butamax. Butamax previously entered into a patent cross-license agreement with Gevo effective as of August 22, 2015 (the “Patent-Cross License Agreement”). The Asset Purchase Agreement terminates the Patent-Cross License Agreement in most respects.
In 2020, Gevo commissioned Peak Value IP, LLC to complete a valuation of its worldwide intellectual property that could be licensed and monetized by Gevo. This valuation included the Butamax-owned patents available for Gevo to use and the Gevo-owned patents, patent applications, trade secrets, and know-how (collectively, the “IP”). Peak Value’s analysis yielded an indicative investment valuation of approximately $412 million for the full scope of the Gevo IP portfolio. The Butamax patent estate acquisition is expected to increase Gevo’s intellectual property value, now that Gevo owns the Butamax patents.