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LONDON - Carbon management solutions provider LanzaTech Global, Inc. (NASDAQ:LNZA), currently valued at $74.14 million and generating annual revenues of $48.83 million, has received a £6.4 million grant from the UK government’s Advanced Fuels Fund to accelerate the development of sustainable aviation fuel (SAF) projects in the United Kingdom, according to a company press release issued Tuesday. According to InvestingPro analysis, the company has been quickly burning through cash, making this government support particularly significant.
The funding will support LanzaTech’s DRAGON 1 and DRAGON 2 projects, which focus on converting recycled carbon into aviation fuel. DRAGON 1 will transform recycled carbon fuel ethanol into SAF at a facility in Port Talbot, South Wales, using LanzaJet’s Alcohol-to-Jet process. DRAGON 2 will be a Power-to-Liquid facility converting waste carbon dioxide and green hydrogen into ethanol for subsequent SAF production, with its UK location to be determined. While the company maintains a healthy current ratio of 2.17, indicating strong short-term liquidity, InvestingPro data shows it remains unprofitable with significant cash burn.
"The future of aviation fuel is ethanol-to-SAF and LanzaTech is at the forefront," said Dr. Jennifer Holmgren, CEO of LanzaTech, in the statement.
The grant is part of a larger £198 million government investment through the Advanced Fuels Fund aimed at expanding cleaner aviation technologies in support of the UK’s recently enacted SAF Mandate.
In a separate announcement, Project Speedbird by LanzaJet, in which LanzaTech holds a 36% ownership stake, received £10 million in funding from the same government program.
LanzaTech’s approach integrates its gas fermentation process with LanzaJet’s technology to produce low Carbon Intensity fuels from regional waste resources. The company currently operates commercially at six assets globally.
The UK government’s investment supports multiple SAF production pathways and feedstocks, recognizing the need for diverse solutions to achieve net-zero aviation goals. For deeper insights into LanzaTech’s financial health, growth prospects, and 13 additional ProTips, visit InvestingPro, where you’ll find comprehensive analysis and expert research reports covering over 1,400 US stocks.
In other recent news, LanzaTech Global, Inc. has announced a planned workforce reduction at its Skokie, Illinois headquarters, set to take effect by August 10, 2025. This strategic move aims to enhance cost efficiency as LanzaTech transitions from a research and development focus to a more commercially oriented entity. In addition, LanzaTech has fulfilled obligations under a Series A Convertible Senior Preferred Stock Purchase Agreement with LanzaTech Global SPV, LLC. This agreement, which required lender consent, will see the maturity date of a related loan extended to December 3, 2029, with interest rates adjusted accordingly.
Furthermore, the company has amended its Series A Convertible Senior Preferred Stock Purchase Agreement, extending key deadlines related to the issuance and sale of warrants and financing activities. Initially, LanzaTech issued 20 million shares of Series A Convertible Senior Preferred Stock for $40 million. The amendment allows for an extension of the issuance date for warrants to purchase 780 million shares of common stock, contingent on obtaining necessary stockholder approvals. These recent developments reflect LanzaTech’s ongoing efforts to scale its global business operations effectively.
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