Lenzing receives €100M loan, via joint European Investment Bank and European Commission financing program, for development of new, high-quality TENCEL fiber products, including construction and operation of new research facilities and pilot plants
February 3, 2014
– With a EUR 100m loan, the European Investment Bank (EIB) is co-financing the research and development (R&D) activities and investment in TENCEL(TM) fibre production of Lenzing AG. This company, which specialises in the industrial manufacture of cellulose fibres, is implementing a multi-annual development programme for new, high-quality TENCEL(TM) products. The loan contract was signed by the EIB and Lenzing today in Vienna.
The TENCEL(TM) fibres manufactured industrially from wood (a renewable raw material) are used primarily in the textile industry, but also for nonwoven materials and technical applications.Lenzing is the only manufacturer in the world that has mastered the technology for producing this latest generation of cellulose fibres on a large industrial scale. These fibres are particularly eco-friendly: TENCEL(TM) fibres leave a much smaller environmental footprint than cotton, for example. Lenzing markets these fibres under the brand name TENCEL(TM). Their qualities include high wet and dry strength, softness and optimum moisture absorption capacity.
The loan provided by the EIB will contribute to the financing of a multi-annual R&D programme undertaken by the company, which includes the construction and operation of new research facilities and pilot plants and the deployment of process innovations. Most of these activities will be carried out at the company's site in Austria.
The loan is being provided to Lenzing under a financing programme implemented jointly by the EIB and the European Commission. This so-called Risk-Sharing Finance Facility is an innovative instrument for sharing credit risks. It is aimed at improving access to external financing for private companies and public institutions promoting projects in the fields of R&D, demonstration and innovation. The financing of R&D activities is one of the EIB's top priorities. In the past year alone, its total lending in this area amounted to EUR 15.6bn.
At the signing of the loan contract, Wilhelm Molterer, EIB Vice-President responsible for lending operations in Austria, stated, "Today, Lenzing is a technology leader in the field of man-made cellulose fibres, thanks in part to its ambitious research and development activities. It is companies like Lenzing that are making a decisive contribution to Europe's innovative and competitive strength. Financing of industrial research is one of the EIB's core tasks."
Lenzing's CEO, Peter Untersperger, commented, "This partnership with the European Investment Bank is a great tribute to the achievements of our company, particularly our research and development work. We are already operating three pilot TENCEL(TM) plants in Europe in order to continue improving the technology and its range of applications. We still see considerable potential for growth in the future which must be explored now, as the demand for high-quality fibres manufactured in environmentally compatible processes will continue to increase."