Bayer and Ginkgo Bioworks are starting a new company that they say will match the biotech’s synthetic biology leadership with Bayer’s knowledge and experience in agriculture and microbial products. The deal is planned to close in the fourth quarter.

A name for the new company, which will have dual headquarters at Ginkgo’s base in biotech stronghold Boston, Massachusetts, and at West Sacramento, California, home of Bayer’s plant biologics R&D activities, has not yet been announced. The two founders, in conjunction with Viking Global Invest Series, will contribute start-up capital of $100 million.

Mike Miille, former CEO of AgraQuest and currently vice president Strategy and Business Management Biologics at Bayer Crop Science, will be named interim CEO. The board of directors will be composed of two representatives from Ginkgo Bioworks, Jason Kelly and Reshma Shetty, and two representatives of Bayer, Axel Bouchon (head of the Bayer Life Science Center) and Jürgen Eckhardt.

Central to the work will be developing technologies to improve plant-associated microbes, with a special and initial emphasis on nitrogen fixation to improve the microbes’ ability to make nitrogen fertilizer available for plants.

Ginkgo will provide exclusive access to its technology, along with laboratory and office space, and will build a new facility exclusively for the new company. Bayer will also provide exclusive access to proprietary microbial strains and all necessary development know-how.

While some crops such as soybeans, peas and other legumes can pair with specific microbes that live within the plant and fulfill their nitrogen needs, most other crops cannot, as the partners explain. Nitrogen fertilizer is thus an essential component of modern agriculture but it can add cost to growers when used inefficiently, the partners note.

An added problem of using nitrogen fertilizers is their potentially negative effect on the environment, driving greenhouse gas emissions and water pollution. The endophytic microbes the company plans to develop are designed to provide a platform to flexibly deliver new agronomic advantages, according to Bayer and Ginkgo.

"Accessing the microbiome is part of Bayer’s innovation strategy, says Kemal Malik, managing board member with responsibility for Innovation. “The plant microbiome is one of the next frontiers in sustainable agriculture,” adds Axel Bouchon, "and it may enable us to take a major leap in plant physiology: producing nitrogen fertilizer directly in the plant.”

The new biotech start-up represents the fifth investment by the Bayer LifeScience Center (BLSC), which operates as a strategic innovation unit within the German chemical and life sciences group and reports directly to its board of management.

BLSC‘s purpose is to uncover, encourage and activate fundamental breakthroughs by creating and building new companies with entrepreneurial best-in-class partners, the group says. The unit’s previous moves include investments in Casebia (CRISPR/Cas technology) and BlueRock (induced pluripotent stem cell technology).

Ginkgo’s third generation automated foundry, Bioworks3, is currently under construction and will be used by the start-up to develop technologies with applications in sustainable agriculture.