Biodegradable resin producer Environmental Polymers Group plc has raised a total of 4.5 million ($6.75 million) through a placement of new shares and a stock offering to existing shareholders.
EPG of Warrington, England, will use the funds to expand production of its soluble moldable polyvinyl alcohol polymer.
The company is completing a 16,000-square-foot resin plant at Irlam, near Manchester, England, where it already operates its 1.3 million-pound-per-year pilot plant on leased property.
"There are many promising opportunities for EPG both in the United Kingdom and overseas. With the new funds at our disposal, I am confident that EPG will be able to make an impact on the plastics industry," said Chief Executive Officer Phil Smith.
EPG is adding six technical process operators to its work force of 30, which will allow the new facility to operate around-the-clock beginning in March.
Meanwhile, the company is starting an aggressive business development program. Last summer EPG set up a group product marketing and customer service department to follow up application opportunities.
One joint venture, Depart Film Products (UK) Ltd., is filling trial orders for 5,000 compostable municipal waste bags, 10,000 carrier bags and 5,000 waste sacks. The customer is a Swedish bag distributor.
EPG claims demand for the material in Scandinavia is growing after samples of bags using the resin were shown at an exhibition in Stockholm, Sweden.
Last year, EPG won a British government Department of Trade & Industry Smart Award of 40,000 ($60,000) to study the feasibility of developing compostable PVOH silage wrap. EPG recently applied for another 125,000 ($187,000) grant.
The PVOH material can be formulated to dissolve in water at a predetermined temperature.
Funds raised through the share offerings will help EPG acquire machinery for the new plant and warehouse, boost its management production systems, fund research and add employees.