Renewcell has announced the purchase bids it received ahead of its 28 March deadline will undergo a thorough review process, with a final closing expected in the middle of April.
Renewcell, which announced its bankruptcy in February, developed a patented process that enables the recycling of cellulosic textile waste, such as worn-out cotton clothes and production scraps to transform them into a new material called circulose.
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The company explained at the time that its decision followed advanced negotiations with its two largest shareholders Swedish fashion brand H&M and biotech company Girindus, as well as its existing lenders, potential new investors and other stakeholders.
Renewcell added that despite these discussions, no concrete solution was found to provide the company with the sufficient financing to be able to complete the strategic review it announced in November with a satisfactory result.
Renewcell’s chairman of the board of directors Michael Berg stated that even though the company was part of “intense” dialogues with both current main owners, new investors, banks and other stakeholders, these discussions were “unsuccessful”.
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He described it as “sad” for the environment, employees, shareholders, and other stakeholders, and “a testament to the lack of leadership and necessary pace of change in the fashion industry”.
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By GlobalDataNon-profit Canopy’s founder and executive director Nicole Rycroft urged the fashion industry to bring Renewcell’s recycled fibre operations back online as well as enable other ventures that are ready to scale circular materials.
She said at the time that the fashion value chain was not fully prepared to support “this first-to-market leader” in bringing sustainable fashion from niche to mainstream despite the ground being more fertile than ever for a “NextGen transformation”.
Renewcell did manage to secure short-term funding of SEK100m ($9.83m) in December, however it aimed to secure long-term financing by the first quarter of 2024.
In January the company announced plans to slash its workforce by 25% in a bid to create savings of SEK35m ($3.4m) per year.
The company’s strategic review was announced in November in response to challenges it faced in terms of sales volume and market dynamic. Renewcell said at the time its decision to conduct a strategic review followed lower-than-expected sales volumes to fibre producers in its third quarter as well as subdued sales in October.
