D1 Oils believes it already has support from most of its shareholders for plans unveiled on Wednesday to dispose of its research business, in the latest upheaval on its drive to commercialise the oilseed crop jatropha.
Martin Jarvis, the chief executive of the UK-based company, said he had consulted holders of some 70% of D1 shares over plans to spin-off the science and technology arm into a company headed by Henk Joos, the group's plant science director.
The investors were either supportive, if some "regretful" that such a step, which requires a shareholder vote, was necessary, Mr Jarvis said.
"They have very right as shareholders to change their minds, but we would not have gone this far if they said this was not what they wanted to see," he told Agrimoney.com.
However, Mr Jarvis acknowledged some uncertainty over the voting power of Harrier Capital, which has bought half of the stake owned by Principle Capital, the investment vehicle of activist investor Brian Myerson, and has an option over the second half.
While Mr Jarvis said he "presumed" that Harrier had voting rights over the total 27% block, but that had yet to be confirmed.
Harrier, for which D1 appears its only biofuels investment, has been a "passively supportive" shareholder so far, and apparently interested in the opportunities for exploiting jatropha in Europe.
The plant produces an oil which can be converted into biofuels, and a meal which D1 is investigating as a livestock feed, and over which it will maintain intellectual property rights even after the disposal of its research business.
The deal has been deemed necessary after the group used up more than half its £10m cash reserves in the year to the end of October, including £1.0m spent on failed attempts to seal a takeover of the company, and fighting proposals by Mr Myerson to merge D1 with a cane ethanol producer, and a later plan to break it up.
The science and technology operation ran up a loss of £2.1m in the year, after failing to win the agronomy revenues it had hoped to.
"This shortfall in agronomy consultancy revenues means that, while the group is anticipated to remain in funds until late 2011, its future cash requirement will be higher than anticipated in November 2009, unless offsetting cost savings can be achieved," the company said.
Disposing of the science and technology division to Mr Joos's consortium, rather than closing it, offered the chance better to exploit the unit's research, through royalty agreement lasting a decade, and to benefit from an investment in the business, made through preference shares.
The deal represents the latest twist in D1's tumultuous history, which has seen it raise cash from investors several times, agree a doomed tie-up with BP, as well as lose an Australian suitor this year on concerns that Mr Myerson would block a deal.
D1 stock closed unchanged at 5.4p in London.