Summary sheet
The loan will finance the first of a kind production plant for a novel nutraceutical, arabinoxylan based ingredient. The nutraceutical is produced from wheat straw and has prebiotic activity. The ingredient has large range of applications in food and beverages industries. The project includes research, development and innovation (RDI) activities to develop product grades, optimise the production process and integrate a tailored spray drying technology in the production facility. The process RDI is needed to reach the full production capacity of the plant, around 5,000 tonnes per annum.
The aim is to establish the production of an innovative biobased nutraceutical ingredient of high interest for the food and beverage industry, in Kalundborg (Denmark). The project is fully aligned to the bioeconomy as it extracts an added-value ingredient from an agricultural residue such as wheat straw, available in excess quantities in the region. In this way, it also supports the rural economy by providing local farmers with additional revenues from the off-take of the excess straw. The integration of renewable energy powered spray drying technology in the production process at Kalundborg facility increases the production efficiency and helps to reduce the related carbon footprint, by avoiding scope 3 emissions linked to the product transport, among other benefits.
The project is fully aligned to InvestEU objectives, fostering activities in the area of Research, Development and Innovation, fostering activities in the industrial application of KETs (i.e. advanced manufacturing) and environment and resources, by implementing the circular economy concepts (i.e. valorisation of wheat straw).
The first of a kind commercial scale facility for the production of innovative bio-based Nutraceutical ingredients creates valuable environmental, health and knowledge externalities. It valorises currently abundant natural resource, wheat straw, by utilizing it as the feedstock for producing high value nutraceutical ingredients. These ingredients are marketed to food and beverages industries for improving the biotic properties of their consumer products.
The project is integrated to an existing 2G bioethanol plant. Due to significant economies of scope gained through this integration, the operation also strengthens the supply for second generation bioethanol, hence reducing carbon externalities in transports.
There are limited alternatives on the market that can provide high risk financing. The EIB intervention supports this innovative SME to obtain quasi-equity financing to carry out the required investments to bring its novel product to the market in a short timeframe. The operation also supports the strengthening of the EU's economic, social and territorial cohesion as it is implemented in a transition region (i.e. Zealand in Denmark). It supports the local economies through creating employment and providing additional revenues for local wheat growers.
Overall, EIB's intervention will provide equity-like risk capital for the Company at a critical time in its development and the scaling up of its sales. This will enable the Company to get market validation for its product and have a catalytic effect on further investments into greenfield manufacturing plants in order to reach critical size.
The project would not have been carried out to the same extent by the EIB without the InvestEU support.
Compliance with the environmental "acquis" (notably EIA directive 2014/52/EU amending the EIA Directive 2011/92/EU) will be assessed during appraisal, as well as compliance with IED directive 2010/75/EU and other applicable environmental acquis.
The promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if after the project appraisal, the EIB were to conclude that the promoter is after all subject to EU public procurement legislation (Directive 2014/24/EU or 2004/18/EC, where applicable), then the Bank would require the promoter to ensure that contracts for the implementation of the project will be tendered in accordance with the relevant applicable EU procurement legislation (Directive 2014/24/EU or 2004/18/EC, where applicable), as well as Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the EU Official Journal, as and where required.