Manufacturer of sustainable construction panels made from waste cardboard in a circular economy system
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | www.unwasted.world/ |
| Sectors | Energy Non-Digital B2B |
| Company number | 11202703 |
| Incorporation date | 13 Feb 2018 |
Investment summary
Business highlights
- Fully operational pilot plant in Wales
- Granted patents and global trademarks
- Lease on 75,000m2 green energy site in Denmark
- £40m in advance orders from European manufacturers
Key features
Idea
Introduction
Unwasted has invented a way to make high quality panel boards entirely from waste cardboard without the use of any glues, resins, or toxic chemicals – making us a highly sustainable alternative to MDF and particleboard.
The circular economy product - NEVERWASTE™ - can be recycled into new panels at end of life many times over.
Demand from manufacturers is likely to soar due to challenging new EU legislation on waste, carbon emissions, and recycling.
No-one else we know of in the world can do this at large scale and in a commercially viable way.
We are ready to scale up from our pilot plant in Deeside to our first full-scale 24/7 plant in Skive, Denmark.
Planning for further plants is underway in UK, Norway, Australia, and the US.
We aim to make a significant contribution to global decarbonization, saving trees from needless harvest and helping our customers get to net zero in their supply chain.
Substantial accomplishments to date
* Deeside pilot plant operating full time and producing high quality product for validation work by customers and the large scale engineering companies that will supply equipment for the full-scale plant
* Lease signed on 75,000m2 site at the GreenLab Skive green energy industrial park in Jutland, Denmark, attracting TV and press coverage
* First advance purchase orders signed by Danish manufacturers for 21,500m3 of NEVERWASTE™ per annum for three years – a revenue stream of c.£40m
* £2.5m equity investment received from a consortium of highly successful Danish industrialists in July 2021
* £1.5m loan facility with UK impact investor Elbow Beach Capital in January 2023
* LOIs signed with parties in Norway and Australia to build, own and operate Unwasted plants
* Early stage discussions with party in US to develop proposition for multiple sites in the US
* LOI signed with major Scandinavian waste management company to supply waste feedstock to Danish plant and subsequent plants in Scandinavia
* Unwasted’s IP valued at minimum £25.52m by independent IP valuers Inngot
* Preliminary term sheet received from Danish Government funding agencies to support funding of the first full-scale plant
* Indicative Life Cycle Analysis completed by the Danish Centre of Environment Assessment at Aalborg University
* Potential new revenue stream identified from carbon credits
Monetisation strategy
Unwasted is designed to enable manufacturers of furniture, flooring, doors, kitchens and many other products to deliver on their sustainability promises to their customers. We can sell by the cubic meter directly to big manufacturers and to major wholesalers and retailers of construction materials and panel boards. It's a simple business model - NEVERWASTE™ is an 'ingredient brand' - think of 'Intel Inside' and you will appreciate the scale of the opportunity in a global market for wood-based panels of 393m cubic meters per annum.
Our product is more expensive than the MDF product it is most likely to substitute; however, NEVERWASTE™ has been designed to help our customers make big savings on carbon tax, carbon credits, and end of life costs, with the aim of getting their production processes to net zero much quicker.
We also intend to realise additional revenue by selling our unused carbon credits on the European carbon market, with the potential to expand this globally if successful.
Use of proceeds
This is an interim funding round intended to ensure the company has sufficient working capital to achieve the following:
- extend cash runway by 12 months, with the aim of raising a Series A round next year in c.£100m in equity & debt funding;
- accelerate the detailed pre-engineering work on the Skive plant design sufficient to satisfy the Series A investors and lenders;
- further strengthen the management team with the appointment of a Chief Operating Officer for Denmark, a Head of Engineering, and a Technical Sales Manager to work with our manufacturing customers on introducing NEVERWASTE to their production process;
- enable capex investment in the Deeside plant to improve process control and capacity to allow the commercial sale of NEVERWASTE panels to selected customers, with the aim of seeding the market and generating revenue ahead of the completion of the first main plant in Denmark.
Key Information
Material Debt
The Company has a loan facility of up to £1,500,000 from Elbow Beach Capital (of which £1,500,000 has been drawn down), with interest accruing at a rate of 1% above the Bank of England’s Bank Rate (subject to a maximum interest rate of 4.5%), per annum. The loan and any outstanding interest are to be repaid by June 2024. The loan is secured by way of a first charge against the Company’s assets.
Unwasted in the process of securing £1.5m of new debt which will be repayable at the end of June 2025. This new debt will be used to immediately and fully repay the Elbow Beach Captial loan in full.
The funds raised from this investment round will not be used to repay any debt obligations.
Share Class Structure
The Company has 3 classes of shares: P Shares, Ordinary Shares and A Shares. All investors in the round, including Seedrs, are receiving Ordinary Shares.
P Shares:
• Voting
• 1x senior participating preference on exit and liquidation.
•Preferential dividend of 5% pa of investment.
Ordinary shares:
• Voting
• 1x junior participating preference on exit and liquidation
• Dividend rights
A Shares:
• Non-voting
• Dividend rights
• Subject to the P Shareholders’ preference below, pro-rata capital distribution rights alongside P Shares and Ordinary Shares
Exit and liquidation preference
On any return of capital to shareholders, distributions will be paid out in the following order:
• P Shareholders will first receive their initial investment amount (plus their preferential dividend);
• Ordinary and A Shareholders will then receive an amount equal to the subscription price of their shares;
• Any surplus proceeds will then be shared pro-rata between all the P, A and Ordinary Shareholders.
Preferential dividend rights
P Shareholders are entitled to a preferential dividend of 5% per annum on the amount they invested (plus any accrued interest). If a dividend is declared, this will be paid out prior to any payment to • Ordinary and A Shareholders. If no dividends are declared, then this sum will be payable to P Shareholders as part of their senior preference prior to Ordinary and A Shareholders on any exit / winding up.
IP Licensing
The Company is in the process of negotiating a licensing agreement with Fiberlean Ltd to license the IP for the production of Micro-Fibrillated Cellulose (MFC). This material is used in the production process of Unwasted Limited’s product, Neverwaste™.
With this licensing agreement, Fiberlean Ltd will also provide services to Unwasted Limited to procure the tools, supply the software to run the equipment and instruct the team on the full production process. The facilities will be housed in the Unwasted Limited site in Denmark. This will ensure that the MFC can be produced at the volume and quality required to produce Neverwaste™.
Unwasted Limited owns the IP for all other parts of their production process.
Group Structure
Investors in this round are investing into and will become shareholders of Unwasted Limited, Company number: 11202703. This is the holding company for the group.
Unwasted Limited 100% owns a subsidiary in Denmark, called Unwasted Aps.
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