LANXESS makes US $10m investment in BioAmber

The relationship between LANXESS, one of Sarnia's biggest Chemical Valley operators and BioAmber Inc.,which is building a commercial scale bio-succinic acid plant on land LANXESS has in Sarnia, appears to be growing, as evidenced by a US $10 million investment.

With the share purchase, which is part of an ongoing process for BioAmber, LANXESS will become a minority shareholder and gain a seat on BioAmber's board of directors.

The announcement appears to be one of the first formal acknowledgements of a relationship that goes beyond a mere land transaction.

Indeed, LANXESS and BioAmber say the investment is a culmination of a strategic collaboration in the field of renewable, phthalate-free plasticizers.

The companies expect to begin sampling succinic-based plasticizers in 2012 and are also collaborating on the development of the plant itself.

Not surprisingly, both companies say the fit is a natural one.

Jorge Nogueira, the head of the Functional Chemicals business unit at LANXESS, will join the BioAmber board. He said the investment "shows our commitment to launching a new generation of plasticizers that satisfy regulatory requirements and can also score in terms of sustainability."

Jean-Francois Huc, BioAmber’s CEO, welcomed LANXESS and Nogueira specifically.  “BioAmber is fortunate to have a strong, committed group of investors and we welcome Jorge Nogueira, a dynamic and experienced chemical industry executive to our board."

Sandy Marshall, president of LANXESS Canada, echoed BioAmber's enthusiasm.  “We are excited to be working closely with BioAmber to anchor the Bio-industrial Park, and this investment is a natural extension of our collaboration."

The process developed by BioAmber consumes considerably less energy than the production of succinic acid using fossil fuels, is significantly more cost-effective and has a better carbon footprint. In the future, the company plans to use waste from the agriculture industry and sugarcane processing as starting materials.

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