Key Highlights:
- NetScientific plc portfolio company DeepTech Recycling successfully closed a funding round to support pilot plant development, technology adaptation, and team building.
- The round, led by EMV Capital, has successfully closed a £0.8 million fundraising, with the combined investment amount which includes a prior close being £2.1 million.
- The company has strengthened its team with strategic hires and a technical advisor, and secured new premises with labs and a testing plant in Oxfordshire to support technology development.
DeepTech Recycling
NetScientific plc announces that its portfolio company, DeepTech Recycling Limited, a plastic recycling technology business offering an innovative solution to the environmental challenges of plastic pollution, has successfully closed a £0.8 million fundraising, with the combined investment amount which includes a prior close being £2.1 million.
Business update
DeepTech Recycling has developed a chemical recycling solution for different types of plastic waste. The company is committed to making plastic sustainable and supporting the global drive towards a circular economy for plastics through the chemical recycling of plastic waste.
Since the fundraise announced on 1 December 2023, DeepTech Recycling has made significant progress, including:
- The signing of a Memorandum of Understanding to develop a commercial plastics recycling facility in the UK, with a purchase order received for the first stage of the facility development project.
- For a second project, the identification by DeepTech Recycling of a shortlist of sites and strategic partners for a 7,000-tonne per annum project.
- The progression of an appointment process of a FEED/EPC contractor, from a high-profile shortlist.
- The enhancement of DeepTech Recycling’s team through strategic hires of new employees. The company has also welcomed Jonathan Seville, previously President of the Institution of Chemical Engineers and Executive Dean of Engineering and Physical Sciences at the University of Surrey, as a Technical Adviser.
- New premises have been secured and set up with labs and a testing plant in Oxfordshire, which will provide the crucial infrastructure to ensure focus on the technology development.
Fundraising
The Fundraising follows a first closing of £1.0 million via an advanced subscription agreement that was completed in December 2023 and a second close of the ASA of £0.3 million shortly thereafter. The investment includes the aforementioned advance subscription amounts. As outlined in the announcement of 1 December 2023, the proceeds of the Fundraising will, inter alia, continue to support DeepTech Recycling in the completion of a development phase for its pilot plant, development and adaption of its targeted technology and licensing strategy, as well as the set-up of its operating base and development of its core team.
The Fundraising was led and syndicated by EMV Capital, NetScientific's wholly owned venture capital and corporate finance firm, and alongside new investors includes further investment from EMV Capital’s EMVC Evergreen EIS Fund.
In December 2022, DeepTech Recycling was set up as a special purpose vehicle to acquire the majority of the assets of Recycling Technologies from the administrator, with NetScientific acquiring a 30% stake at near nil value. Following the Fundraising, NetScientific's direct stake in DeepTech Recycling will be 21.2% on a fully diluted basis. This equates to a post-investment fair value uplift of £1.8 million. The capital under advisory of EMV Capital in respect of investors introduced by it to DeepTech Recycling is £2.1 million, representing 29.3% of the captable on a fully diluted basis.
Marvine Besong, managing director and CTO of DeepTech Recycling, said: “EMV Capital has provided a unique support package, helping our team to restart and accelerate progress with DeepTech Recycling, and to access a supportive investor base that is committed to ESG and real impact in the plastic waste management space. It is only 1.5 years since the start of the company, we are now poised to take on exciting projects in the UK and internationally, driving sustainability in plastics and transforming waste into high-value resources. The future looks promising for DeepTech Recycling.”
Dr Ilian Iliev, CEO of NetScientific and Interim Chair of DeepTech Recycling, commented: “Marvine and his team have effectively leveraged the recent fundraise, accelerating DeepTech Recycling through critical development phases. We are excited to support their progress in major projects in the UK and internationally. This journey perfectly exemplifies our capital efficient and value-creation strategy, turning a once undervalued and distressed asset, effectively valued at zero in 2022, into a thriving venture, and providing NetScientific shareholders with a significant and valuable stake at minimal cost.”