Biochemicals company Circa Group AS has successfully raised NOK 575 million in gross proceeds - approximately EUR 56 million - through a private placement of 34,300,000 new shares at a subscription price per share of NOK 16.75, equivalent to a pre-money equity value of the company of NOK 1,500 million.
The private placement carried out by Circa Group attracted strong support and interest from Norwegian and international investors and was more than 15 times oversubscribed, excluding shares pre-allocated to the seven cornerstone investors. These investors - BNP Paribas Energy Transition Fund, Delphi Fondene, DNB Asset Management, Handelsbanken Fonder, The Fourth Swedish National Pension Fund, Robeco Asset Management and Circa’s industrial partner Norske Skog ASA - have, subject to certain terms and conditions, undertaken to subscribe for and be allocated shares for NOK 310 million.
Norske Skog has invested NOK 50 million and holds 31,654,274 shares after the transaction, which shares are subject to a six months lock-up agreement.
There will be in total 119,412,580 shares in the company in issue following the issuance of the new shares, resulting in a post-money market capitalisation of the company of approximately NOK 2 billion.
In 2009, Circa patented its Furacell production technology, which enables the production of Levoglucosenone (LGO) from abundant and renewable biomass waste. To date, Circa’s LGO platform has produced a range of sustainable biochemicals with applications within industries ranging from pharmaceuticals and flavours to electronics, batteries, polymers and much more.
Circa is now leading the consortium for a new EU Horizon 2020 flagship project called ReSolute, which will see the construction of an LGO flagship plant for the production of Cyrene, a bio-based and biodegradable solvent Cyrene, in one step.
Circa will use the net proceeds from the private placement to fund the construction of the 1,000 tonne ReSolute plant in France and to further develop the company’s portfolio of chemical derivatives. The ReSolute plant has received a €12 million flagship grant from the EU’s Horizon 2020 programme.
Tony Duncan expressed his appreciation for the success of the placement and stressed the role of Norske Skog, saying: “This journey started in 2005 and would not have been possible without the tremendous efforts of our employees, partners and shareholders. I wish to highlight our close collaboration with Norske Skog and their Boyer Mill in Tasmania where the FC5 pilot plant is located and continues to operate. Their involvement has been invaluable in proving the scalability of the production process.”
The Circa IPO initiates phase 3 - the manufacture and commercialisation of the levoglucosenone biomolecule platform for industry - and is a positive signpost for the biomaterials industry as a whole, he added. “It is clear that consumers want better, safer, more sustainable products and brand owners need to respond before the regulators do.”
Trading starts on Euronext Growth Oslo under the trading symbol at 09:00 CET today (2 March 2021).