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Martineau Johnson helps to complete the loop

26/03/2007

Birmingham and London law firm Martineau Johnson has played a key role in connection with the finance for a pioneering plastics recycling plant.

The facility, which will show the way forward for the recycling of plastics for food packaging in the UK, is the product of a multi million pound investment by Closed Loop London (Closed Loop), a company well known for its groundbreaking initiatives in recycling.

Martineau Johnson provided legal advice to private equity fund manager Foresight Venture Partners (FVP).

FVP brought together its VCT funds and a syndicate of private and small fund investors (Foresight Funds) to invest a total of £4.6m in Closed Loop, a cash injection which will enable the environmental specialist’s recycling plant to be built on land at Dagenham in Essex.

This will be the first UK recycling plant of its kind to produce recycled material suitable for food packaging. The plant will be able to recycle PET (polyethylene terephthalate), which is a clear plastic used in soft drinks containers. Until now, it has been largely sent to landfill or exported to Asia for low-grade industrial re-use.

Kavita Patel, a specialist in venture capital trust (VCT) investment and Enterprise Investment Schemes (EIS) at Martineau Johnson, said: “The investment by Foresight in Closed Loop shows the benefit to all concerned of VCTs and EIS investment.

“They can play a pivotal role in securing the future development of such companies as Closed Loop, which could otherwise find themselves victims of the so called ‘equity gap’, the size range in which businesses find it difficult to raise equity finance.

“In the case of Closed Loop, the finance provided has enabled the business to tap into government support and bank debt to move forward.”

Foresight is the fund manager for a stable of market leading VCTs, which includes the most successful VCT fund in the country, Foresight Technology VCT.

Martineau Johnson’s team which advised Foresight was headed by Roger Blears and Kavita Patel, who have a special interest in the use of VCT finance to back businesses in the area of the environment and sustainable technology.

Martineau Johnson was recently awarded the title of ‘Best EIS Legal Advisor of 2006,’ as voted on by the members of the EIS Association.

Allied Irish Bank is providing the debt financing and has been advised by Blake Lapthorn Tarlo Lyons. Berwin Leighton Paisner LLP advised Closed Loop on the funding.

For further information please contact Roger Blears on roger.blears@martjohn.com