London-based Future Capital Partners, with £15 million raised for a bioethanol project, is looking to raise an additional £25 million from high net worth investors and companies.
FCP anticipates closing Future Fuels No. 1, the fund supporting the project, in September, after which it will begin construction of a biothenaol plant in Grimsby, England. The plant will be operated by Vireol and produce renewable transport fuel, ethanol and two co-products—a high protein animal feed and CO2. FCP is in the process of negotiating deals for the sales of both products.
The firm is predicting post-tax returns in excess of 30% annually over a five- to seven-year period. In addition, investors will benefit from the tax relief available from the investment structure. Investors will be able to offset their initial investment against future income tax liabilities through the ability to claim capital allowances.
FCP is partnering with specialist project finance bank Natixis to structure about £80 million of senior debt facility.
Said Tim Levy, Future Capital Partners CEO:
“Future Fuels is a unique investment product. The legally mandated growth of the renewable transport fuel market allows for highly attractive returns, while the downside protection offered by the tax structure of the investment makes this a low risk opportunity. Securing the involvement of Natixis is a key piece in the financial jigsaw. With their expertise in structuring senior debt onboard, we can now look forward to financial close and breaking ground in Quarter 4 this year.”