Gaia Biomaterials secures investment for limestone-based compostable material expansion

04 Apr 2024 --- Bioplastics manufacturer Gaia Biomaterials has concluded a US$5 million rights issue backed by Almi Invest Greentech and international and domestic private investors. The funds will be used to expand Gaia’s market presence in the US, India and elsewhere. 

The Sweden-based company’s home-compostable material, Biodolomer, is based on limestone, which is a broadly available mineral. Biodolomer can replace fossil plastic for various applications such as drinking cups and grocery bags. It is fully compostable, has a low carbon footprint and does not break down into microplastics during the composting process. 

Peter Stenström, Gaia Biomaterial’s CEO, tells Packaging Insights that the team has been working on the issue for six months and is now bringing in partners from the industry and a government investment fund. 

The company plans to expand its market presence by continuing to expand its network of agents and distributors, he explains.

A rights issue is when a firm offers its shareholders the opportunity to purchase additional shares for a reduced price.

Healthcare-safe material
One of the key investors is the Swedish state-owned greentech venture capital fund, Almi Invest Greentech. 

“We look for great commercial and environmental potential combined,” says investment manager Jörgen Bodin. “Although we look at about 300 companies yearly, we only invest in a handful.”

Gaia’s limestone-based material was recently used for cups at the Formula 1 final in Abu Dhabi.“Gaia Biomaterials has a proven track record of living up to its promises. Its product has enormous potential as it is climate-positive and will reduce waste and microplastics.”

Notably, Gaia’s material was recently used in beer cups for the Formula 1 final in Abu Dhabi, UAE. 

Stenström tells us that the F1 cups were sold by the company’s customer I’m Not Plastic. Regarding their disposal, “the cups have either been composted or there has been incineration. When incinerated, the material produces up to 80% less carbon dioxide compared to fossil plastics.”

Biodolomer is also used in various disposable products to replace fossil plastic, including healthcare aprons, drinking straws, food containers and plant pots.

North American potential 
According to Stenström, Biodolomer has very few application limits. “Our material can be used in various production techniques, including film blowing, bottle blowing, thermoforming, injection and extrusion coating, with no changes in machinery. This makes it easy for brand owners to reduce CO2 emissions and waste,” he says.

“Now that BPI has certified our material, we see a very big potential in North America.”

Today, Gaia has a production capacity that can be scaled up to 50,000 metric tons annually within the existing structure. 

“The need for plastic replacement is recognized globally, and we are witnessing tremendous interest in our offerings. Responding to the high demand from brand owners, we are currently expanding our network of commercial agents worldwide.”

By Natalie Schwertheim