JBSAY - Lab-grown meat specialist Steakholder Foods pops after signs multi-million-dollar agreement with Middle East entity

2023-07-24 10:36:54 ET

Cultivated meat specialist Steakholder Foods Ltd. ( NASDAQ: STKH ) announced on Monday that it has entered into a memorandum of agreement for strategic cooperation with an accredited GCC-based governmental body as its strategic partner. The agreement is aimed at advancing food security efforts through the application of Steakholder Foods' ( STKH ) 3D printing technology.

Steakholder Foods ( STKH ) said an investment will be made with the strategic partner in the construction of a pilot plant to produce printed hybrid-fish products. The MOA eventually aims to create a first-of-its-kind large-scale production facility in the Persian Gulf region.

The agreement foresees a material initial down payment to Steakholder Foods for the procurement of its 3D-printer technologies, followed by a milestone-based sales and procurement plan for industrial-scale output. The MOA is also intended to contribute to the scalability of Steakholder Foods' 3D-printed food technology in territories in the Gulf Cooperation Council, which represents the economic union between Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

CEO statement: "After intensive years of development, Steakholder Foods is excited to sign this first agreement with a strategic partner, generating our first income stream that represents one of the first substantial income agreements for a company in the cultivated meat industry, a huge step forward. We believe that we have chosen the right partner, and together, we are committed to advancing the cause of food security and creating a positive impact on the world."

Shares of Steakholder Foods ( STKH ) jumped 16.65% in morning trading on Monday.

Sector backdrop: In June, U.S. regulators approved the sale of chicken made from animal cells for the first time, in what could be a landmark development for a long list of companies looking to produce lab-grown meat. The Agriculture Department gave the green light to California firms Upside Foods and Good Meat to sell what is referred to as cell-cultivated or cultured meat and poultry. The approval came several months after the U.S. Food and Drug Administration determined that products from Upside Foods and Good Meat were safe to eat. The move could launch a new era of meat production aimed at eliminating harm to animals and drastically reducing the environmental impacts of grazing, growing feed for animals and animal waste.

Tyson Foods ( TSN ) is an early investor in Upside Foods. The growth of lab-based meat could also eventually be of interest to Hormel ( HRL ), JBS SA ( OTCQX:JBSAY ), Bridgford Foods ( BRID ), Cargill's various meat concerns, Sysco ( SYY ), and Pilgrim's Pride ( PPC ).

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