Innovative Composites International Inc. (ICI) will get a $1.5 million infusion in the form of a loan and equity funding to cover a corporate restructuring and stabilize the thermoforming business as it seeks to meet its full sales potential in the housing, transportation and composite panel markets and beyond.
The Toronto-based company entered into an agreement with Bassett Financial Corp. to receive a $500,000 bridge loan and $1 million of equity funding in exchange for meeting a list of stipulations related to corporate governance, intellectual property, payment fees and more.
ICI recycles plastic water bottles and other materials into sound-barrier panels used to make prefabricated housing modules, truck body containers, cargo containers and highway barriers that buffer neighborhoods from freeway noise.
The new funding should give the company about 18 months of operating cash and working capital to pay some bills, step up production to address a backlog of orders, build up inventory and find more commercial and industrial applications for its patented technology.
For example, ICI recently saw sales increase when it shifted some focus from home and emergency shelter products for disaster relief situations to other customers, according to the new investors.
“ICI has an incredible array of practical, cost competitive and environmentally friendly products that we believe will see growth in demand in the coming years and we are excited to become an active partner to assist the company in managing this growth effectively,” Basset CEO Matthew Bassett said in a news release. “By bringing a renewed focus on sales growth and conservative capital management to the company, we believe that ICI will be well positioned to deliver increased value to all its stakeholders, old and new.”
Matthew Bassett will be nominated to ICI’s board of directors as part of the agreement, and another Bassett official, Chris Carl, will be named the chief financial officer.
The goal of all parties is to revise ICI’s business plan and increase sales in Canada and the United States, in part by identifying new opportunities for its line of lightweight, non-corrosive structural building materials that meet needs of large corporate customers in a wide range of industries.
“With the support of Bassett we now have the financial foundation to pursue these opportunities systematically and professionally,” ICI CEO Mark Rivers, said in a news release.
ICI should become a profitable organization within the next few years, he added.
“Not only does Bassett bring much needed financial assistance, but their experience in growing and managing small public companies makes them excellent partners for our capable technical management team,” Rivers also said.