A major green deal for Alginor
Borregaard, Hatteland and the EIC fund to invest up to NOK 427 million in a total capital raise of up to NOK 497 million
Alginor ASA and its founding company Zirconia AS, has come to an agreement with Borregaard, Jakob Hatteland and the European Innovation Council Fund in raising approximately NOK 300 million in equity capital through a direct offering of new shares at NOK 35 per share executed over two tranches from Q3 2021 until end of May 2022.
The transaction has been carried out under Alginor's own auspices and comprises the equity component of the ongoing DACOTA project under the EIC’s “Green Deal” initiative.
After completion of the first tranche, Borregaard and the EIC Fund will each hold 24.99% of the shares in Alginor.
Moreover, Alginor aims to carry out a public equity issue of up to NOK 70 million in the near future at NOK 35 per share, where existing and new investors will be invited to participate (excluding Borregaard, Hatteland, Zirconia and the EIC Fund). More information regarding the upcoming public equity issue will follow closer to launch.
Between May 2022 and end of April 2024, Borregaard may acquire additional shares through a direct equity issue. This equity issue may bring Borregaard’s ownership in Alginor up to 35% fully diluted and bring another NOK 126 million in equity to Alginor (NOK 119.7 million if executed before 30 April 2023).
The abovementioned transactions are subject to the final approval of the extraordinary general meeting of Alginor ASA to be held on Friday, 6 August 2021.
Alginor has secured financing for its planned upscaling
After 7 years of dedicated development, Alginor has now acquired the financial capabilities needed to industrialise and commercialise its life science ingredient portfolio based on Laminaria hyperborea for sale to the global pharmaceutical and nutraceutical markets.
The company is planning to make significant investments in a new state-of-the-art harvesting vessel, a biorefinery and a cGMP industrial facility at Avaldsnes, Norway.
“We welcome our new investors and specifically Borregaard on board as a strategic and industrial owner after completing an extensive validating process of our technology and business plan. We thank the public funding initiatives like the EU programmes for supporting our green and disruptive business idea with needed risk capital in an effort to facilitate for its commercial success. Thanks to our dedicated 25 employees — all of whom are shareholders and are participating in an extensive incentive programme, and our 296 shareholders who have supported us through the years, Alginor is now entering a very exciting phase of demonstration and upscaling of the company’s core technologies. In this phase, we hope to benefit from Borregaard’s relevant competence and biorefinery experience, before taking Alginor to the stock exchange within 3 years.”
— Thorleif Thormodsen, founder and CEO of Alginor
Sarpsborg-based Borregaard began as a pulp and paper company over a hundred years ago and is now one of the world’s premier biorefining companies. Only using wood as raw material, they produce a wide array of products within lignin biopolymers, speciality celluloses, cellulose fibrils, biovanillin, and bioethanol. Borregaard — as a strong and listed Norwegian company — accredited for their unique qualities and expertise in biorefining, offers significant advantages to Alginor going forward.
“There are striking similarities between Borregaard’s business model and the biorefinery concept under development by Alginor. Both strategies are built on full utilisation of unique and sustainable raw materials for high-value products to global market niches. We realise that it will take time to scale up and fine tune production and to establish a global business, but we see this as an interesting opportunity with potential synergies between the two companies in several functions.”
— Per A. Sørlie, President and CEO of Borregaard
The European Investment Council has supported the development of Alginor’s innovative technology by providing grants through various EU programmes (SME Instrument phase 1, SME Instrument phase 2, Eurostars initiatives). Now, when the company is moving into the next phase, the EIC Fund provides additional equity alongside private investors under the EU’s “Green Deal" to advance this exciting technology.
“We see that Alginor and Borregaard is a good match that can secure successful commercialisation of the technology and the future listing of the company on the Oslo Stock Exchange.”
— Heidi Kakko, member of the Investment Committee of the EIC Fund
Jakob Hatteland co-founded Norway's first unicorn Autostore with major success and has continued developing several successful and promising industrial companies in his Nedre Vats-based cluster, e.g. ERP software company RamBase. Hatteland has regularly supported Alginor with necessary capital over the last three years and has been the company's largest financial contributor prior to this transaction. He will further his investment and financial contribution by participating in the first tranche of the transaction.
“We have been following Alginor as an early investor for more than three years. The company has already shown an impressive traction, and we are pleased to continue our investments and to support the development and growth of Alginor.”
— Jakob Hatteland, the Hatteland Group