AlgaVia algae ingredients, TerraVia, Solazyme
Solazyme offers such specialty food ingredients as AlgaVia whole algae ingredients.

SOUTH SAN FRANCISCO — Solazyme, a supplier of algae-based ingredients, will change its name to TerraVia as it plans to focus exclusively on food, nutrition and specialty ingredients.

That’s not the only change for the South San Francisco-based company. Solazyme has entered into a definitive purchase agreement for a financing round of about $28 million. The company also is looking for a new chief executive officer. Jonathan S. Wolfson, company co-founder and c.e.o., has been appointed chairman of the board. He will assume a full-time role as executive chairman once a new c.e.o. is named.

Solazyme offers such specialty food ingredients as AlgaVia whole algae ingredients and AlgaWise algae oils. The company’s consumer food products include Thrive culinary algae oil. The company also offers specialty personal care ingredients, and animal nutrition ingredients are a new area for the company.

Mark Brooks, TerraVia, Solazyme, algae oil
Mark Brooks, senior v.p. and general manager of food ingredients at Solazyme

“There are opportunities for our algae-based ingredients across every aisle of the grocery store, driven by consumer demand for clean labels and an increasing focus on plant-based foods with great taste,” said Mark Brooks, senior vice-president and general manager of food ingredients at Solazyme. “We are enhancing a new generation of foods that deliver better flavor and nutrition, including healthier fats and enhanced protein, fiber and micronutrients.

“In addition to products incorporating our ingredients on store shelves today, we are currently in active development projects with major C.P.G. companies for new products such as salad dressings and gluten-free bakery products that are healthier and offer the taste and texture that consumers demand.”

Algawise Thrive culinary algae oil, TerraVia, Solazyme
Solazyme's consumer food products include Thrive culinary algae oil.

The financing round will be in newly issued, no-coupon convertible preferred shares with a conversion price of $2 per common share, which represents about a 25% premium over the 15-day trading average of Solazyme’s common stock. The investor group includes Glenhill Capital, which invested in Boulder Brands; VMG Partners, a private equity fund that has invested in Kind and Pirate’s Booty; Powerplant Ventures, L.L.C.; Charles Chang, founder and former c.e.o. of Vega; ARTIS Ventures, an investor in food and technology; Simon Equity Partners, which invested in Plum Organics; Jack Davis, retired c.e.o. of Ventura Foods, L.L.C.; and Keith Belling, founder and former c.e.o. of Popchips.

Solazyme also has named Irene Chang Britt to its board of directors. Previously she was president of Pepperidge Farm, senior vice-president, chief strategy officer for Campbell Soup Co., general manager for Kraft Foods and vice-president at Nabisco.

Jonathan Wolfson, TerraVia, Solazyme, algae oil
Jonathan Wolfson, co-founder and c.e.o. of Solazyme

“By unlocking the power of algae, the mother of all plants and earth’s original super food, we are bringing much needed innovation in food and nutrition,” Mr. Wolfson said. “Our new generation of breakthrough ingredients and foods delivers on nutrition, flavor and texture all with an unparalleled sustainability profile, and these products are already beginning to penetrate a market that is demanding healthier alternatives.”

Solazyme has been active in industrial markets such as fuels and industrial oils. Those initiatives now will be grouped together as “Solazyme Industrials” and will not be part of TerraVia’s focus. Solazyme over the next 12 to 18 months will pursue strategic alternatives for Solazyme Industrials.