29/01/2010

Finance Wales invests in ‘cleantech’ business

Land Energy has started production of wood pellets as an alternative commercial fuel in a £2 million investment in Bridgend, South Wales, backed with £350,000 debt investment from Finance Wales.

Land Energy recycles wood into pellets that can be used as a biofuel in power stations and industrial sectors for heating. It acquired a former wood pellet facility in Bridgend and has invested in a new 12,000sq ft process, storage and feedstock building, new wood fibre refining machinery and upgraded fibre grinding and wood pellet capacity. The company is forming a network of localised wood pellet manufacturing plants throughout the UK to tackle the growing need for renewable energy sources.

Rhian Pugh and Karen Davies, Investment Executives at Finance Wales, worked on the deal. Pugh said: “Biomass is becoming more important by the day as companies seek alternatives to conventional fuels and pressure mounts to reduce CO2 emissions. Land Energy has set out a biomass strategy that it sees as a key to delivering fuel diversification and carbon abatement. We are pleased to be backing this project through our £150 million commercial fund, demonstrating our commitment to supporting the growth of businesses that are developing new ideas and commercial opportunities.”

John Westmacott of Land Energy said: “Sourcing investment for the new business was imperative to get it off the ground. We are pleased to have the backing of Finance Wales which has worked closely with us throughout the process.”

Advisors on the deal were Black and Veatch Ltd who provided technical advice to Finance Wales.

Finance Wales provides commercial funding to small and medium-sized businesses in Wales. It launched a new £150 million fund in April 2009, backed with funding from the European Investment Bank and the EU through the JEREMIE (Joint European Resources for Micro to Medium Enterprises) initiative.