Carbios is postponing construction of its PET depolymerization plant in Longlaville, France, by six to nine months because of delayed funding.
The French biotech company broke ground on the facility, which it calls the world’s first PET biorecycling plant, in April, 2024.
Carbios obtained non-dilutive funding of 30 million euros ($30.6 million) under the France 2030 program, which aims to stimulate employment, boost productivity and increase the competitiveness of French businesses. The company said the subsidy has been approved but its release is pending authorization by the European Commission.
The biotech company is also waiting on 12.5 million euros ($12.7 million) from the Grand Est Region, where the plant is located.
Carbios said in a statement that its negotiations with Indorama Ventures are not yet finalized. In June 2023, the companies signed a non-binding memorandum of understanding (MOU) to form a joint venture to build the plant. According to the terms of the MOU, Indorama Ventures will mobilize about 110 million euros ($112 million) for the joint venture in equity and non-convertible loan financing, pending final engineering documentation and final economic feasibility studies.
The total capital investment for the new plant is now estimated to be around 230 million euros ($234 million), considering recent impact from inflation.
The company said it has entered discussions with other private and public financial institutions likely to provide financing for the project "under favorable conditions."
It added that the French State, through the country’s investment bank Bpifrance, has given its "potential support" for debt coverage under the Strategic Projects Guarantee (GPS) scheme.
Carbios said the postponement does not call"‘the plant construction into question." The company said it had cash reserves of 92.8 million euros ($93.8 million) as of Nov. 30, 2024. It assured it is "well-positioned to meet its needs beyond the next 12 months."
“To ensure the prudent execution of our strategy and safeguard our cash flow in a complex environment, we are postponing construction of the plant in line with the expected timetable for public grants and the negotiation of the necessary additional non-dilutive financing,” said Philippe Pouletty, founder and chairman of the board of directors at Carbios.
The postponement announcement was accompanied by a change of governance at the company. Pouletty replaced Emmanuel Ladent as CEO on Dec. 18 on an interim basis, as the board of directors recruits a new CEO.
Carbios now expects to start supplying recycled PET in 2027 rather than 2026. It also expects to sign "several" binding commercial contracts in the first half of 2025.
The Longlaville plant is expected to process about 50,000 tonnes of post-consumer PET waste per year, equivalent to 2 billion PET colored bottles or 2.5 billion PET trays. The plot on which the plant is being built offers space to double the capacity in the future.
Carbios’ enzymatic depolymerization process enables the efficient and solvent-free recycling of PET plastic and textile waste into virgin-equivalent products.