Foresight Group (“Foresight”), the leading UK venture and growth capital investor, has completed three new investments, totalling £14 million, in the environmental sector. The investments further boost Foresight’s reputation as an investor in this space with a strong focus on investments in the infrastructure which is supporting the increasing demand for recycling and renewable energy generation in the UK.
Foresight has invested £5 million in Yorkshire-based Land Energy, a producer of wood pellets, to fund the development of wood pellet production plants. Each plant will source wood from local forests and produce pellets for local use, delivering renewable wood fuel in the form of wood pellets to schools, homes and offices in the area in order to help them lower their carbon impact. Although wood is not a new fuel for heating, its value as a renewable resource has just begun to be recognised. In Germany, for example, wood pellet consumption for fuel has risen ten-fold in the last four years because pellets are both easy to use and economical.
“Land Energy fits our vision of a business that helps the environment while offering attractive returns to investors. We are working with the company to roll-out the concept to three regions of the UK. We strongly believe that local sourcing of wood pellet fuels will gain popularity in the future as people start to count the rising financial and carbon costs of transporting fuel.” said Matt Taylor, a Partner of Foresight Group.
The second investment sees Foresight committing £6 million of funding to AWP Environmental, a company that is looking to reduce the amount of potentially dangerous industrial wastes, such as used oil, paints and inks, which are sent to landfill. Over five million tonnes of hazardous waste is sent to landfill or incinerators in the UK every year. AWP is already a market leader in the collection and effective disposal of these materials and is believed to be the first such business to adopt a zero emissions policy. The company now plans to convert waste materials into renewable electricity using an advanced gasification technology to avoid harmful emissions. The development of the new plant in Tockwith, Yorkshire will cost approximately £18 million and will supply enough electricity to power around 6,000 homes.
“AWP is bringing proven processing technology from abroad to solve UK waste problems. Foresight has made the investment to fund the new plant with a view to rolling-out the concept to other sites around the UK in the future,” adds Matt Taylor.
Completing the trio of new investments is Lynwood, a company which collects off-cuts and waste materials from manufacturers of a variety of plastic products and remoulds this material into useful products. The company’s outdoor furniture range has already attracted the attention of several Local Authorities interested in purchasing, for example, park benches that neither rot nor need painting. The company has also identified a major future opportunity relating to the replacement of wood in construction. Lynwood is Foresight’s second investment in plastics recycling, building on the success of plastic-bottle recycler, Closed Loop. Foresight has agreed a £3 million cash injection which will enable the company to more than double production capacity and fund its expansion across the UK.
Andrew Page, the Foresight partner responsible for the firm’s investments in Lynwood and Closed Loop, commented: “Landfill just isn’t an option any more for valuable wastes of this sort. Lynwood’s expertise in plastics sourcing and blending positions the company as a leader as the industry moves from waste to re-using valuable materials.”
Bernard Fairman, Managing Partner and Founder of Foresight, said:“These investments follow the successful raising of Foresight’s £22 million EIS fund at the end of 2007 which continues to see very strong deal flow and is already more than 40% committed. The environmental infrastructure market is developing very quickly, as we predicted when we launched the fund, and we are seeing a wide range of interesting deals across the infrastructure space, so much so that we have recently added a fourth member to the team to keep up with the flow of investment opportunities. “
For further information, please contact:
Matt Taylor, Foresight Group+44 (0)1732 firstname.lastname@example.org
Annabel O’Connor / Ashleigh Lezard, Capital MS&L+44 (0)20 7307 5330
About Foresight Group
Foresight Group is a leading growth investor with a 20 year track record and approximately £160 million under management. The firm's first institutional fund returned over £4.00 for every pound invested. Foresight Group is also the manager of the UK’s best performing venture capital trust. Foresight is a leading investor in environmental infrastructure and cleantech in the UK and recently closed over-subscribed the largest ever EIS fund targeting investments in environmental infrastructure.