Austria, Sweden, Finland: Borealis receives EIB loan for development of circular economy solutions for plastics
24 September 2020
EIB grants €250 million in funding for Borealis’s research, development and innovation (RDI) programme
Loan to boost Borealis’s research and development efforts in propelling the industry towards plastics circularity
Borealis’s corporate sustainability strategy in close alignment with goals of European Green Deal and EU Plastics Strategy
The European Investment Bank (EIB) and Borealis have successfully closed a benchmark financing agreement that supports the Borealis research, development and innovation (RDI) programme in the circular economy sphere. The EIB will provide a €250 million loan supporting Borealis’ multi-year investment programme in the area of plastics circularity, in line with its objectives to support innovation, climate action and sustainability. The loan enables Borealis to intensify the development of novel, polyolefins-based circular solutions at its Innovation Centres in Austria, Sweden and Finland. Polyolefins produced by Borealis are used in a wide range of applications in consumer products, packaging, power transmission cabling, and industrial and construction materials.
As a leading provider of innovative polyolefins solutions, Borealis aims to make its own core business more circular. The circular economy is one of three key areas in the new Borealis 2035 Group Strategy which was announced earlier this year. Borealis has been at the forefront of industry efforts to accelerate the transformation to a circular economy of plastics. Its proprietary Borstar®, Borlink™ and Borceed ™ technologies have recently been enriched by Borcycle™, an evolving technology that enables the production of high-quality recycled polyolefins (rPOs), and the Borenewables™, a portfolio of circular polyolefins produced with renewable feedstock derived entirely from waste and residue streams.
Borealis has already begun working with value chain partners in recent years to develop and launch innovative, value-adding circular solutions in a variety of industries, including energy, automotive and consumer packaging. Borealis also aims to integrate an ever larger share of recycled plastics in its products.
The European Investment Bank (EIB) is the long-term lending institution of the European Union and owned by its Member States. It provides long-term capital and advisory support for sound investments that contribute towards EU policy goals. The European Investment Bank Group is one of the largest public supporters of innovation in the European Union. Since 2000, the Group has invested over €210 billion in innovation and skills in the European Union and beyond in order to advance innovation and address the social and economic challenges of today and tomorrow. To help tackle climate change, the EIB Group will also aim to support €1 trillion of investments in climate action and environmental sustainability in the critical decade from 2021 to 2030. This also includes circular economy projects. Over the past five years (2015-2019), the EIB has provided around €2.5 billion in loans to co-finance more than 100 circular projects, and stands ready to do more to help meet the lending needs of the circular economy transition.
“We are exceedingly pleased to be able to boost our research and innovation activities in Europe thanks to the EIB,” says Alfred Stern, Borealis CEO. “It is good to have strong partners who share our belief in the importance of re-inventing for more sustainable living.”
“The promotion of circular solutions in the polyolefins industry is aligned with our goals to accelerate the transition to a circular economy, including for plastics, and to support cutting-edge innovation,” explains Ambroise Fayolle, EIB Vice-President. “We are happy to continue and intensify our collaboration with Borealis AG by signing our largest transaction together so far. As the EU’s climate bank, we are eager to support private sector partners that are committed to environmental sustainability.”
Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With its head office in Vienna, Austria, the company currently has more than 6 900 employees and operates in over 120 countries. Borealis generated €8.1 billion in sales revenue and a net profit of €872 million in 2019. Mubadala, through its holding company, owns 64% of the company, with the remaining 36% belonging to Austria-based OMV, an integrated, international oil and gas company. Borealis provides services and products to customers globally, in collaboration with Borouge, a joint venture with the Abu Dhabi National Oil Company (ADNOC), and with Baystar™, a joint venture with Total in Texas, USA. www.borealisgroup.com
After its first year of operation, the Joint Initiative on Circular Economy provided €2.7 billion of long-term financing for projects that will help accelerate the transition towards a circular economy. This initiative launched by the six largest public financial institutions in the EU aims to finance at least €10 billion of investments to support the circular economy over five years (2019-2023).
The EIB will provide up to €20 million to finance the research, development and innovation (RDI) strategy of PROSOL, a family business that manufactures and distributes coffee products such as instant (soluble) coffee and single-serving products (capsules). This financing comes under the European Fund for Strategic Investments, which enables the EIB Group to offer increased support for investments fostering innovation, economic growth and employment.
The EIB has signed a €40 million (SEK 416m) loan agreement with Swedish biotech company Oncopeptides AB. The financing will support research, including phase 3 clinical studies of the lead candidate melflufen, and the expansion of the company. The EU bank’s loan is backed by a guarantee from the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe under which the EIB and the European Commission are working together as strategic partners, with the EIB’s financing operations boosting the competitiveness of the European economy.