Fibria to Invest $20 Million in Biomass Producer Ensyn
Clean Edge News
Dr. Robert Graham, Chairman and Chief Executive Officer of Ensyn Corporation and Marcelo Castelli, Chief Executive Officer of Fibria Celulose S.A. announced the creation of a strategic alliance between the two companies. The alliance includes the establishment of an equally-owned joint venture for the production of cellulosic liquid fuels and chemicals in Brazil, as well as a US$ 20 million equity investment in Ensyn Corporation by Fibria. The goal of the Ensyn-Fibria joint venture is to combine the strengths of each party to create a major producer of renewable liquid fuels from cellulosic feedstocks. Fibria, a pulp producer, has expertise in fiber production as well as a significant presence in Brazil.
Ensyn and its affiliates have developed the Rapid Thermal Processing (RTP) technology, which converts wood and other non-food biomass into renewable liquid fuels and chemicals. Ensyn’s renewable liquid fuel, Renewable Fuel Oil (RFO), is a petroleum replacement fuel with uses in many applications, including heating, conversion to transportation fuels and power generation in diesel engines. The strategic relationship also includes a US$ 20 million equity investment by Fibria in Ensyn Corporation, the Ensyn parent company. This investment will provide Fibria with ownership of approximately 6% of Ensyn and also provides Fibria certain rights, which, if exercised, would allow Fibria to invest additional capital and increase its holdings to as much as 9% of Ensyn. In addition, Fibria will be granted one seat on Ensyn’s Board of Directors.
Fibria will be joining a group entities working with Ensyn in the development of a renewable fuels business based on Ensyn’s RTP technology including UOP, a Honeywell company. The UOP strategic alliance, which takes place through jointly held Envergent Technologies LLC, is related to the engineering and supply of RTP equipment and RFO upgrading solutions. Ensyn’s current shareholders include Credit Suisse, Impax Asset Management plc, CTTV Investments LLC, a division of Chevron U.S.A. Inc., Felda Palm Industries Sdn Bhd, and Investeco Capital Corp. This transaction is targeted to be closed by the end of October.