Closed Loop Partners receives $10M from SK Global Chemical
Closed Loop Partners receives M from SK Global Chemical
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SK Global Chemical (SKGC), headquartered in Seoul, has invested in the Closed Loop Circular Plastics Fund and the Closed Loop Leadership Fund. The Closed Loop Partners’ funds will invest in businesses with the goal of advancing circular business models, scalable recycling technologies and material recovery infrastructure in the U.S. and Canada to help increase the supply of high-quality recycled content available and reduce the extraction of virgin resources. According to a news release from Closed Loop Partners, its collaboration with SK Global “is a critical step in demonstrating what the future of a fully circular plastics system could look like and sending a market signal to others to spur recycling markets that must mature more quickly.”
“Plastics manufacturers play a key role in building circular systems for plastics––they are at the early stages of the supply chain, helping determine the quality, sustainability and recyclability of the plastics that flow through the entire system,” says Ron Gonen, founder and CEO of Closed Loop Partners, headquartered in New York. “It’s critical that these stakeholders adapt to the changing times and expectations; antiquated business models that rely on virgin plastics are no longer viable when confronted with limited natural resources and mounting plastic waste.”
Gonen adds that SK Global Chemical’s investment will help catalyze circular plastics supply chains in the U.S. and Canada and facilitate the sharing of best practices with Asia.
Georgia Sherwin, director of strategic initiatives and communications at Closed Loop Partners says the organization is excited about SKGC’s investment for numerous reasons. “We are seeing increasing momentum among plastics producers investing in solutions to global waste challenges and rethinking their business-as-usual approach toward a more sustainable future. These are the companies at the early stages of the supply chain, helping establish the sustainability and recyclability of the plastics that flow through the system, so it’s critical that they are participating in building solutions to plastic waste.”
She adds that SKCG “continues to invest billions more dollars into plastics recycling infrastructure beyond the work of the Closed Loop Circular Plastics Fund, helping to advance the system collectively.”
SKGC’s investment with Closed Loop Partners builds on the company’s Zero Plastic Waste goals and its efforts to bolster innovations across the plastics recycling system, the news release notes. With its “Green For Better Life” strategy, SKGC is growing plastics recycling capacity globally. The company aims to recycle 900,000 tons of plastic per year by 2025, reduce its use of plastics and make all of its products eco-friendly by 2027.
In pursuit of these goals, SKGC has formed strategic partnerships with advanced plastics recycling companies in North America, invested on the ground in new facilities that transform plastic waste into virgin-like plastics and continues to optimize mechanical recycling infrastructure to reduce overall virgin plastic consumption, Closed Loop Partners says.
SKGC recently announced that it had signed a memorandum of understanding (MOU) for a proposed joint venture with Montreal-based Loop to build sustainable polyethylene terephthalate (PET) and polyester fiber manufacturing facilities throughout Asia.
Earlier this year, the company also announced that it had signed an MOU with California-based Brightmark aimed at constructing a plastics renewal plant in South Korea with 100,000 tons of annual capacity.
According to Closed Loop Partners, one of the reasons SKGC chose to collaborate with the firm is to expand its connections to a roster of multinationals with extensive scale and emerging innovators introducing differentiated circular economy solutions. The SKGC investment with Closed Loop Partners aligns with the ambitions of its parent company, SK Innovation, to transition from “carbon to green” by investing more than $20 billion in five years.
SKGC’s investment in Closed Loop Partners’ Circular Plastics Fund, which launched in May with Founding Investors Dow, LyondellBasell and Nova Chemicals, brings the fund closer to its goal of deploying $100 million to advance the recovery of plastics in the U.S. and Canada. The fund seeks to fill investment gaps to spur recycling markets, attract additional corporate investors and financial institutions and accelerate capital inflows beyond the fund’s own commitments, Closed Loop Partners says.
The Circular Plastics Fund has targeted three strategic areas for investment:
- increasing the collection of targeted polyethylene (PE) and polypropylene (PP) plastics by advancing current and next-generation material collection systems, including transportation, logistics and recycling sortation technologies and infrastructure;
- upgrading recycling systems to more efficiently aggregate, classify and sort the targeted plastics to increase the total amount of high-quality plastic, including food-grade and medical-grade plastic, sent for remanufacturing; and
- investing in facilities and equipment that manufacture finished products, packaging or related goods using recycled content, including recycled PE and PP.
The Closed Loop Leadership Fund, Closed Loop Partners’ private equity arm, is a complementary market rate strategy that proves the growth and profitability of circular economy business models, according to the firm. The fund seeks to acquire and scales best-in-class companies along the value chain to build circular supply chains in the U.S. that are focused on extending the useful life of materials, including plastics and packaging, organics, electronics and apparel. The Closed Loop Leadership Fund has invested in material recovery facility Balcones Resources, Austin, Texas, and electronics recycler ERI, Fresno, California.
Since its founding in 2014, Closed Loop Partners says it has made more than 50 investments, diverting more than 4,600 million pounds of material from landfills and back into manufacturing supply chains. Building on its track record and ecosystem of entrepreneurs, industry experts, global consumer goods companies, retailers, financial institutions and municipalities in North America, Closed Loop Partners is well-positioned to form key partnerships and drive strategic investments to advance SKGC’s goals.
Na Kyung-soo, CEO of SKGC, says, “We aim to build systems that keep plastics in circulation, meeting the needs of people around the world, without compromising the natural environment. Our investment with Closed Loop Partners not only helps us advance these goals but opens doors to new strategic partnerships with leading companies that share the same vision of advancing circular systems for plastics. As a plastics manufacturer, we recognize our responsibility in transforming plastics supply chains to collect and reuse existing materials and know that collaborating across industries is essential to system-wide impact. We look forward to working with Closed Loop Partners and their network to drive toward our shared goals.”
By 2025 SKGC says it will invest $500 million to build an advanced plastics recycling plant in Korea.
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Source: Recycling Today
Closed Loop Partners receives M from SK Global Chemical
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