Stockholm – Scandinavian Enviro Systems (Enviro) and Michelin have finalised the details of a tire recycling strategic partnership, nearly six months later than originally expected.
The two companies announced the intended partnership in April - with the aim to finalise a deal in June - for the use of Enviro’s technology for recovering waste rubber materials. As part of the deal, Michelin acquired a 20% stake in the Swedish company.
Under the terms of the agreement, Michelin is now entitled to establish its own recycling plants based on Enviro’s technology.
When establishing such plants, Michelin shall pay an upfront lumpsum to Enviro with a predetermined, fixed non-recurring amount as well as royalties based on a percentage of the plant’s sales.
The license agreement shall remain in force until 2035, according to Enviro, which is also entitled to continue establishing recycling plants with other parties.
“Despite the pandemic and the ensuing delays, we have now been able to finalise our agreement regarding a strategic partnership with Michelin,” said Enviro’s Chairman Alf Blomqvist.
The agreement, Blomqvist said was “a very important milestone” for Scandinavian Enviro Systems and a “very significant validation of our technology.”
“We have managed to reach these main principles agreements in a year where the unprecedented sanitary situation has made it very difficult to ‘sit together’ and plot the course for our future collaboration,” he noted.
While negotiations were stalled due to Covid, Blomqvist said the delay gave more time to Michelin and other international manufacturers to test Enviro’s recovered carbon black.
The agreement is subject to a final approval by Enviro’s shareholders at an extraordinary general meeting, scheduled for January next year.