EMPTY PROMISES: Former SPAC Company AppHarvest Gets Delisting Notice from Nasdaq
Posted on 04/22/2023
AppHarvest, Inc., a Certified B Corporation, is an American food production company developing and operating indoor farms in Appalachia. AppHarvest went public via the SPAC route. AppHarvest has missed projections for sales and the construction of its Kentucky greenhouses, where it grows tomatoes, greens, and strawberries.
At one point, AppHarvest had a market capitalization as high as US$ 3.7 billion. AppHarvest drew in investors such as Norway Government Pension Fund Global, BNP Paribas Asset Management UK, BlackRock Fund Advisors, The Vanguard Group, Inc., SSgA Funds Management, Inc., Geode Capital Management LLC, Jane Street Capital LLC, and Alyeska Investment Group LP. AppHarvest founder and CEO Jonathan Webb is a major holder of the stock. Webb is the son of a Kentucky machinery dealer who was raised in nearby Lexington, Kentucky.
For example, AppHarvest predicted in 2020 it would achieve US$ 62 million in revenue during 2022. However, the actual revenue generated in 2022 was only about US$ 14.592 million, the company disclosed recently. They incurred net losses of US$ 176.6 million and US$ 166.2 million during the years ended December 31, 2022 and 2021, respectively.
Billions Wiped Out
At April 21, 2023, AppHarvest’s market capitalization sits at US$ 72.67 million.
Some Pre-Public Funding
In August 2022, AppHarvest secured US$ 50 million in two loans guaranteed by the United States Department of Agriculture (USDA) through Greater Commercial Lending (GCL), a subsidiary of Greater Nevada Credit Union, to support the development of its indoor berry farm in Somerset, Kentucky.
In May 2019, Equilibrium Capital’s Controlled Environment Foods Fund agreed to invest nearly US$ 100 million to build an AppHarvest greenhouse. AppHarvest raised millions more from the ValueAct Spring Fund and from the venture capital firm Revolution’s Rise of the Rest Seed Fund to finance the company’s engineering, administration, staff, and start-up operations. Rise of the Rest is a fund established in 2017 by Steve Case, co-founder of AOL and chairman of Revolution.
