Corbion has offered to pay $20m in cash to acquire TerraVia.

Other firms may make higher bids for the beleaguered microalgae company under the sale process conducted according to Section 363 of the US Bankruptcy Code.

Considering TerraVias operations are currently running in losses, Corbion expects the formers financial commitments to be more than the price it offered.

TerraVia filed a voluntary petition under Chapter 11 of the US Bankruptcy Code yesterday.

The auction process and final agreement will be subject to the approval of the US Bankruptcy Court for the District of Delaware.

The completion of the transaction will also be subject to customary closing conditions and regulatory approvals.

The auction process is expected to complete between 60 and 90 days.

TerraVia produces oils, as well as speciality fats and ingredients such as Omega-3 from microalgae. It has R&D centre in San Francisco, along with two manufacturing facilities in Illinois and Brazil.

While the company has a 100% ownership of the Illinois-based plant, the Brazilian facility is co-owned by a joint venture comprising TerraVia and Bunge.

Corbion expects that the acquisition of TerraVia will enable it to expand its product portfolio into algae-based fatty acids and proteins, while leveraging its fermentation and downstream processing capabilities.