PureCycle Applied sciences LLC has merged with one other firm and the brand new company plans on promoting public stocks on the stock market.
The announcement got here on Nov. 16 that PureCycle would merge with Roth Capital Companions and Craig-Hallum Capital Group to create a brand new firm referred to as PureCycle Applied sciences, Inc. and will likely be listed on the Nasdaq Capital Market beneath the brand new ticker image PCT. Moreover, ROCH right this moment entered into definitive buy agreements for a $250 million widespread stock PIPE transaction. The transactions are anticipated to shut within the first quarter of 2021.
PureCycle is understood for its means of turning used polypropylene, one of the crucial generally used plastics, right into a resin that’s pure sufficient it may be utilized in packaging for meals and solely makes use of a fraction of vitality that it takes to make virgin resin.
PureCycle began up its feedstock analysis unit in Haverhill, on the outdated Dow Chemical website, in partnership with Proctor and Gamble in 2015. The corporate is now working in the direction of building on its first recycling plant in Lawrence County. As soon as open, the plant may have the capability to recycle over 107 million kilos of polypropylene and to provide 100 million kilos of ultra-pure recycled polypropylene per 12 months, beginning in 2022.
Final 12 months, Time journal referred to as PureCycle’s recycling course of top-of-the-line innovations of 2019. In response to the journal, PureCycle has already presold their merchandise for the subsequent twenty years.
“This transaction represents a key milestone in PureCycle’s mission to transform polypropylene into a recyclable and sustainable product,” stated Mike Otworth, CEO of PureCycle. “The proceeds of this transaction are intended to provide us with the balance sheet strength to accelerate the global rollout of our proven technology addressing the immense global problem associated with polypropylene waste.”
Otworth stated that roughly one p.c of the 170 billion kilos of polypropylene waste is recycled yearly and most of it leads to landfills or oceans, which creates environmental issues.
“We look forward to partnering with the Roth CH team on an efficient, accelerated path for a successful public listing,” he stated.
Byron Roth, Chairman and CEO of Roth CH, stated the corporate had seemed for a enterprise mixture that will not solely be a compelling development firm however might additionally profit from the relationships and expertise of its two development funding banks.
“We imagine PureCycle’s technology will likely be transformative in plastic recycling and assist firms meet their sustainability targets,” Roth stated. “We look ahead to a successful future collectively.”
The enterprise mixture has been unanimously authorised by the boards of administrators of each PureCycle and Roth CH. The enterprise mixture is predicted to shut within the first quarter of 2021, topic to regulatory and stockholder approvals and different customary closing circumstances.
In response to a press launch, the brand new firm will turn into a publicly-listed entity with an ascribed professional forma fairness value of $1.2 billion and an enterprise value of roughly $826 million, topic to closing changes. The transaction will likely be funded by an issuance of roughly $835 million of latest widespread stock of Roth CH to present holders of PureCycle, $76.5 million of funds from the Roth CH belief account and funds from the $250 million PIPE at $10 per share. Following the transaction and after cost of transaction bills, PureCycle is predicted so as to add roughly $667 million to its stability sheet — inclusive of the proceeds from the $90 million in fairness non-public placements and $310 million of debt and convertible financings.