Innovative indoor farming start-up AppHarvest, the operator of one of the world’s largest high-tech greenhouses in Kentucky, will go public through a reverse merger with the special purpose acquisition company (SPAC) Novus Capital Corp, according to a press release. The alliance will put the Morehead, Kentucky-based company’s market value at around $1 billion, according to the release. The company said it will receive $475 million from “existing and new investors,” which include Fidelity Management & Research Company, LLC, Inclusive Capital, and Novus Capital Corporation. According to the release, it is anticipated that the deal will close late in the fourth quarter of 2020 or early in the first quarter of next year.
“We are excited to transition AppHarvest to a public company and raise nearly a half a billion dollars in the process,” said Jonathan Webb, Founder & Chief Executive Officer of AppHarvest. “This will allow us to pursue our mission of transforming agriculture. A mission that’s become even more important since the global pandemic exposed how a rapidly increasing reliance on imports jeopardizes food security,” Webb said. The company’s board of directors include Martha Stewart, Impossible Foods CFO David Lee, and Narya Capital Partner J.D. Vance.
AppHarvest operates a 60-acre high tech greenhouse in Morehead that, according to the release, is “designed to reduce water usage by 90% compared to traditional open-field agriculture and eliminate agricultural runoff.” The release also notes that the first produce slated for harvest are tomatoes and that 60 percent of all fresh tomatoes sold in U.S. stores are imported.
Webb told Axios that by the end of the year AppHarvest will employ 350 people in Morehead, Kentucky, one of “America’s poorest congressional districts.” Webb also said that AppHarvest’s central Appalachia location means that produce can reach 75% of the continental U.S. by vehicle in a day. Webb is a Kentucky native who founded AppHarvest in 2017 and has in the past worked with the Department of Defense on solar plans, CNBC reports.
The company’s goal is “to improve access to fresh non-GMO fruits and vegetables, as approximately 70% of the U.S. population is within a one-day drive of the Morehead, KY facility, which AppHarvest estimates will lower transportation costs compared to existing growers by up to 80%,” according to the release. The company said that the $435 million-plus in cash it expects to receive from the transaction will be used for funding future operations like more high-tech indoor farms.
In August, AppHarvest raised $28 million in a Series C round of funding, bringing its two-year total funding to $150 million, according to Bloomberg Green.
“We want the consumers of our fruits and vegetables to be the owner in our company, be the advocate in marketing with us that is going to help drive agriculture forward here in America,” Webb said on CNBC’s “Squawk Box.”