Infinited Fiber, a Finland-based producer of recycled textile fibres, has completed a two-part €40m series B financing round. With new investments from well-known fashion brands, the company wants to continue scaling up production of its Infinna fibre, which is made from cotton-rich and cellulose-containing waste materials.
The new investors include Inditex Group, parent company of brands such as Zara, as well as TTY Management. The asset management firm is privately owned by Tadashi Yanai, founder and president of the Japanese clothing company Fast Retailing, which owns brands such as Uniqlo and Comptoir des Cotonniers. The two outdoor and sports clothing producers Youngone and Goldwin were also part of the second part of the most recent financing round, in which a total of €27m was raised for Infinited.
H&M, Adidas and Zalando invested in previous round
The first part of the latest financing round closed in September 2023 and raised funds from existing investors such as H&M Group, Adidas, Bestseller und Zalando. Following closing of the second part of the round, Inditex, TTY Management and H&M Group are the largest shareholders in the Finnish recycling firm.
Falk Müller-Veerse, German partner at Bryan, Garnier & Co. and leader of the financing round, stressed the relevance of the deal in the context of upcoming changes in the fashion and textile industry: "Not least due to the new European regulations, the market demand for sustainable fibres in Europe is expected to triple to almost four million tonnes per year by 2030."
The financial transaction was led by the investment bank Bryan, Garnier & Co. Analysts at the bank expect global demand for sustainable textiles to triple by the year 2030 and estimate the addressable core market is around €66bn.
Wrangler and Tommy Hilfiger already producing with the new recycled fibres
The solution developed by the Espoo-headquartered company is based on chemical recycling. According to Infinited Fiber, textile waste and other cellulose-rich products such as paper, board and some agricultural residues can be transformed into 100 per cent circular textile fibres with the "look and feel" of cotton. Several companies have attested to the quality of the fibre and its market potential by signing long-term purchase agreements: Inditex alone has signed a contract worth more than €100m, according to Mr Müller-Veerse. Several limited-edition clothing collections, such as Wrangler jeans and Tommy Hilfiger T-shirts, have already been produced with the new fibres.
According to Infinited Fiber, in comparison to pure cotton, the use of their recycled fibres reduces water consumption in the production of t-shirts by up to 97 per cent and avoids two-thirds of CO2 emissions. "The new material could also replace up to 20 per cent of the polyester fibres used worldwide today and is completely biodegradable without bioplastics," Mr Müller-Veerse said, stressing the potential of the technology.
Job cuts agreed in February
In recent months Infinited Fiber has realigned its plans, putting a priority on finalising its project execution model and technology concept for the first commercial plant. The series B financing round would enable the execution of the updated plans, but would take more time than originally anticipated, the company explained in December. In light of the "challenging" financial market for growth companies and in an effort "to be thoughtful on prioritizing actions and streamlining costs", the company began negotiations with employees just before the end of 2023. Last month, Infinited Fiber announced that those talks had been concluded and would result in both "temporary layoffs and permanent contract terminations across all company functions".
