AppHarvest secures $91m financing to fuel 2025 indoor farming ambitions
AppHarvest's current 2.76 million-square-foot facility in Morehead, Kentucky, has been up and running growing and supply tomatoes to top US grocers and restaurants in the central Appalachia region.
Earlier this year, the company raised $475m and went public through a SPAC (special purpose acquisition company) merger with Novus Capital and is currently trading on the NASDAQ under the ticker symbol APPH (debuting at $35.69 per share and is now trading at around $12.34 per share as July 27, 2021).
“AppHarvest is laser-focused on scaling its mission. The financing we’re announcing today demonstrates the expected viability of high loan-to-value, non-dilutive capital financing as we remain on track to develop up to 12 high-tech farms by the end 2025,” said AppHarvest president David Lee.
With a focus on making investments in the controlled environmental agriculture sector, Equilibrium Capital is providing 65.5% loan-to-value financing through a $91m construction loan to support the build out of AppHarvest's second facility in Richmond, Kentucky, which is currently under construction.
In addition to its 60-acre Richmond, Kentucky, facility, the company has three additional farms in Kentucky that are under construction: a 15-acre facility in Berea designed to grow leafy greens, a 30-acre facility in Somerset designed to grow strawberries, and a 15-acre leafy green facility in Morehead.
“Equilibrium sets the bar for impactful investing in assets and companies centered on advanced sustainability principles. Their continued support of our mission shows confidence in our business model to build a climate-resilient food system based on great-tasting, nutritious fresh fruits and vegetables with more predictable yield and quality,” said AppHarvest founder and CEO Jonathan Webb.
"We’ve been supportive of AppHarvest since early in their history and look forward to more opportunities to partner as they build out their network of high-tech, climate-resilient farms,” said Equilibrium CEO and chairman David Chen.
According to a report from S2G Ventures, the controlled environmental agriculture sector is expected to grow 5x in share over the next 10 years with the potential of accounting for up to 10% share of US vegetable and herb production by 2025.
"We can envision a future where controlled environments demonstrably improve market access to affordable, high-quality, and nutritious produce and redefine local food systems. This development will occur in stages and the principles of commercial success may vary widely by geography and offering, likely resulting in a hybrid evolution of growing methods and formats in the medium-term."
