Singapore-based Circulate Capital invests in Indian plastic recycling company, Deluxe

Circulate Capital, the Singapore-based investment management firm that funds innovation, ventures and infrastructure to prevent ocean plastic and climate change by advancing the circular economy, today announced that the Circulate Capital Ocean Fund (CCOF I) invests in Deluxe Recycling Private Limited (Deluxe).

Deluxe is an Indian plastics recycling company that recycles difficult multi-layered plastics (MLPs), such as used beverage bags and cartons (UBCs), into new valuable products, such as pallets and rickshaw seats.

By creating a market for MLP waste, the company plans to divert 34,000 tons of waste from incineration or landfill by 2025, helping to pave the way for a circular economy in India.

Generally considered worthless and very difficult to recycle, MLP waste is one of the dirtiest forms of plastic packaging and, if collected, is used for fuel, incineration or co- treatment at cement plants, he said in a press release.

How it works?

Deluxe has developed a scalable ecosystem for MLP collection by working with and paying for a network of aggregators and small material recovery facilities (MRFs) to collect and sort MLP waste. The company then uses proprietary technology developed in-house to manufacture a variety of heavy and rigid products. In 2020, the company recycled 7,100 tons of MLP, making it one of the largest organized recyclers of MLP in India.

The Circulate Capital Ocean Fund investment will enable Deluxe to expand to three new facilities in western and southern India, tripling its capacity.

Investment fund focused on ocean plastics

The Circulate Capital Ocean Fund is the world’s first investment fund focused on ocean plastics in South and Southeast Asia, created in partnership with leading global companies, PepsiCo, Procter & Gamble, Dow, Danone, Chanel, Unilever, The Coca-Cola Company, Chevron Phillips Chemical Company LLC and Mondelez International. As Deluxe grows, its infrastructure can be leveraged to create a circular market for multilayer plastics and accelerate industry development as new technologies are deployed, he said.

Deluxe provides 90% recycled seat panels

Rob Kaplan, Founder and CEO of Circulate Capital, said, “Hard-to-recycle plastics like pouches, food wrap and plastic packaging have remained a global challenge in the waste management and recycling industry. Deluxe’s ​​breakthrough technology and entrepreneurial savvy has enabled the company to turn these multi-layered plastics into valuable products on a scale never seen before in India. Deluxe currently supplies 90% of the recycled seat board market, which means almost every rickshaw driver sits on a Deluxe recycled seat.

“The dynamism and size of the Indian market presents a huge investment opportunity in the transition to a circular economy for plastics. Deluxe is firmly positioned at the forefront of this transformation and we are proud to support their growth,” added Kaplan.

India generates 9.4 MT of plastic waste per year

The problem of plastic waste, especially MLPs, is increasing in India, with the country generating 9.4 million tons of plastic waste annually. Only 60% of plastic waste is collected, and 3.8 million tonnes flow into the environment each year.

According to the Ellen MacArthur Foundation, India’s circular economy development path could create an annual value of Rs 14 lakh crore ($218 billion) in 2030 and Rs 40 lakh crore ($624 billion) in 2050 by compared to the current development scenario. This could reduce 44 Circulate Capital’s greenhouse gas emissions as well as a significant reduction in air pollution, contributing to health and economic benefits to society.

Jignesh Shah, Co-Founder of Deluxe, said, “At Deluxe, we see the potential to transform India’s MLP waste into a valuable common raw material, encouraging its collection and replacing the need to use virgin plastics.

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Posted: Tuesday April 5th 2022, 12:34 PM IST


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