French biodegradable plastics company Carbios is targeting at least €122m from a non-underwritten rights issue as it continues to move towards production using its technology.
Carbios developed proprietary enzymes to break down polyethylene terephthalate (PET), which is commonly used for bottles and textiles.
Proceeds will partly finance the €230m construction cost of a PET recycling plant and fund further R&D.
The rest of the funding for the new plant will come from strategic partner Indorama Ventures (€110m), a €30m grant from the French government and €12.5m from the Grand-Est region, as well as some of Carbios' €83m of available cash. The plant is expected to begin operations in 2025 and will be 75% owned by Carbios and 25% by Indorama.
“It is now time to take our industrial and commercial project a step further with the commissioning in 2025, in France, of the world’s first PET biorecycling plant, in partnership with Indorama Ventures, a leading producer of recycled PET for the bottle market,” said CEO Emmanuel Ladent.
The rights issue comprises 4.83m new shares offered on a 3-for-7 basis at €25.32, a 29% discount to TERP of €35.67, based on the €40.10 close on June 20.
Unusually for a rights issue, there is the opportunity to increase sizing through the issue of a further 725,047 shares. That will be dependent on sufficient oversubscription.
There are commitments for €18m from BOLD, L'Oreal's corporate venture fund; Copernicus Wealth Management; Michelin Ventures; L’Occitane Group; Truffle Capital and three members of the company’s board. Copernicus and Michelin are expected to carry out tail-swallow transactions in order to participate.
Shares go ex-rights on June 23, with subscription beginning on June 27. Rights trading ends on July 5 and subscription closes on July 7. A result is due on July 11.
Carbios shares were up 18.9% year-to-date as of Wednesday’s €40.70 close. Shares closed at €29.50 in early May but have since surged due to the grants from the French government and Grand-Est region.
The stock fell heavily on Thursday, down 12% at €35.80 shortly before the close.
BNP Paribas, Bryan Garnier and Natixis/Oddo BHF are joint bookrunners.