Circa Group completes IPO

I know the bio-based chemicals industry has been through a rough patch during the past couple of years when it comes to public financing for start-ups so we are cautiously optimistic about companies that are now trading through various stock exchanges worldwide. In the USA, Gevo and Amyris seem to be doing very well these days and we are also keeping our fingers crossed for the newly-inducted ones such as Danimer and (soon) Origin Materials.

In Europe, Avantium, Global Bioenergies and METabolic EXplorer are on my watch list. Biochemicals firm Circa Group will join this list as the company announced its NOK 575 million (€56 million) initial public offering (IPO) on Euronext Growth Oslo (ticker code: CIRCA) which started trading on 2 March 2021.  The transaction was led by Pareto Securities and Sparebank 1 Markets in Oslo with a post-money market valuation of around NOK 2 billion (~€194 million). The private placement reportedly attracted strong interest from high-quality and global institutional investors and was more than 15 times oversubscribed (excluding pre-allocated shares). Cornerstone investors include 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.

Source: Euronext

Established in 2006, Circa Group converts waste, non-food biomass into advanced bio-based chemicals with its proprietary Furacell™ process. Its developing product portfolio includes flavours, biopolymers, and bio-solvents including Cyrene™, an alternative to traditional polar aprotic solvents, which is produced in one step from platform biomolecule Levoglucosenone using woody cellulose feedstock.

The proceeds from the private placement will be used to build the 1,000-tonne/year 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.  The facility is expected to start commissioning in year-end 2022.

I wrote a special report last year on Tecnon OrbiChem’s Bio-Materials newsletter about the market for bio-based solvents that included Cyrene™ solvent. The main advantage of Cyrene™ is its chemical structure that reportedly provides polarity almost similar to NMP without any inclusion of an amide group that is associated with toxicity. Cyrene™ has a density of 1.25 g/ml, and reportedly does not contain chlorine, nitrogen or sulphur. Cyrene™ is also reportedly stable and yields only water and carbon dioxide upon biodegradation or incineration. One key property of Cyrene™ that is reportedly underexploited is that it is miscible with water.

Also, check out my recent post on how the EU Green Deal will affect the European solvents market. By the way, for our friends in the pulp and paper industry, Circa Group’s Furacell™ process has already been scaled up in a demonstration plant in Tasmania, Australia in partnership with Norwegian pulp and paper company Norske Skog. Aside from solvents, applications for the building block levoglucosenone is continuously being developed by Circa including a new class of compounds with anti-microbial and/or cytotoxic properties and building blocks for coronavirus therapeutics ribonolactone.