Atome: Feeding The Future

ATOME is at the heart of a structural shift in agriculture, where low-carbon fertilisers are essential to feed a growing population while reducing emissions. Fertiliser demand is expected to grow steadily as global population reaches 10 billion by 2050, requiring 60% more calories. Around half of the global food supply relies on synthetic nitrogen fertilisers to maintain crop yields, making them vital for food security.

However, conventional nitrogen fertilisers account for around 5% of global greenhouse gas emissions. ATOME’s Villeta project will produce up to 260,000 tonnes of carbon-free calcium ammonium nitrate (CAN) annually, directly addressing this challenge. Income generation is expected to begin immediately upon plant start-up in 2028, offering early returns on investment. This positions ATOME not only as a sustainability-driven business but also as a solution provider in a sector facing rising regulatory, environmental, and food security pressures.

Villeta is a first-of-its-kind project: a large-scale, low-cost green fertiliser plant secured through long-term partnerships with Yara and Hy24, a $465m EPC contract with Casale, and government-backed Free Trade Zone incentives. But ATOME is not a one-project story. With Yguazu (300MW) and Costa Rica (120MW) in the pipeline, the company is building a platform capable of repeating this development model—scaling its revenue and EBITDA base while retaining a G&A light structure.

Villeta itself is already significantly de-risked and approaching major near-term catalysts including FID and construction. The same project structuring, power access, and commercial blueprint used at Villeta is already in motion for future assets, potentially taking group EBITDA above $230m by 2030.

ATOME shares are trading at a fraction of their potential, well below consensus analyst targets (130–174p) and significantly under the implied project valuation set by Hy24, which attributed $60m to ATOME’s carried stake in Villeta alone. Despite a clear path to near-term earnings, the company’s current market cap of ~£30m is less than 10% of the $465m cost of Villeta. Analysts forecast $70m in annual EBITDA from Villeta once operational, with group EBITDA potentially exceeding $230m by 2030. This sharp valuation gap reflects a disconnect between market perception and the tangible value of a de-risked, near-ready asset.

Management owns over 30% of the business, including Chairman Peter Levine and CEO Olivier Mussat, ensuring strong alignment with shareholders. With early-stage de-risking largely complete and expert leadership in place, the gap between valuation and fundamentals suggests substantial upside potential.

• Finalisation of the full offtake agreement with Yara in H2 2025: This agreement, covering 100% of Villeta’s production, will mark a crucial commercial de-risking milestone. Its conclusion would enhance confidence in the project's economic viability and should allow the company to finalise debt financing.
  

• Full financial close for Villeta project and FID announcement, targeted mid-2025: Achieving financial close and reaching the Final Investment Decision (FID) would confirm full project funding and trigger the next phase of construction. This is a key milestone that could re-rate the equity.

• Start of construction at Villeta in late 2025 or early 2026: Breaking ground on the project would be a visible signal of execution progress. Early construction work, especially by credible EPC partner Casale, would increase confidence in the timeline and capital discipline.
  

• Announcements of formal PPAs and site control for Yguazu and Costa Rica projects: Advancing these two pipeline projects into formal development will validate ATOME’s ability to replicate the Villeta model. Securing low-cost renewable energy and regulatory support in these markets will enhance the strategic value of the pipeline.

• First commercial production from Villeta in 2028, generating $65–70m p.a. free cash: Initial cash flows from Villeta would prove the commercial economics of green CAN at scale and transition ATOME from developer to operator, supporting valuations on a cash flow basis.
  

• Progress on second and third projects, with scaled EBITDA potential above $230m by 2030: As Yguazu and Costa Rica mature, investor focus will shift to total group EBITDA potential. Delivering on the second and third projects could more than triple the cash flow base and cement ATOME’s position as a category leader in green fertiliser.

• The development of ATOME Power: The company’s standalone renewable energy division (although still early stage): Establishing a standalone power division could enhance long-term earnings stability and offer vertical integration benefits.

Although ATOME has taken strong steps to de-risk Villeta through fixed-price EPC contracts and partnerships with experienced firms like Casale, infrastructure projects of this scale and complexity often face unexpected challenges. Potential delays in permitting, supply chain issues, or construction overruns could push out the commercial operation date beyond 2028. Furthermore, as a first-of-its-kind green fertiliser plant, Villeta has no direct peer benchmark, which adds uncertainty to cost control, commissioning timelines, and early operational performance.

ATOME’s revenue model depends on long-term demand and pricing for CAN fertiliser, which can be influenced by a wide range of factors including commodity prices, global agricultural cycles, and geopolitical dynamics. Although the Yara offtake includes pricing mechanisms to offer downside protection, these are not fully disclosed. If global fertiliser markets face supply gluts, or if green premiums are slower to develop than expected, the project's economics could face downward pressure, particularly in early years.

ATOME’s strategy hinges on bringing in project-level equity investors and securing debt at the asset level, with the parent company maintaining minority stakes. While this capital-light model preserves optionality, it also leaves the company dependent on favourable capital markets and investor appetite. Any failure to close funding rounds on target could delay progress or force less favourable terms. Moreover, if additional capital is needed at the holdco level, equity raises could dilute existing shareholders, especially if share price remains disconnected from net asset value.