Michelin Invests in Enviro’s Technology
The key principle terms have been negotiated as a result of the letter of intent regarding a strategic partnership that was announced by both companies in April 2020. The agreed key principles include terms for the establishment of a first jointly owned recycling plant, and terms for how Michelin shall compensate Enviro for use of the company’s patented recycling technology for end-of-life tires. The agreement on compensation applies to the first plant as well as for any future plants that Michelin might decide to build.
Regarding the right to use Enviro’s patented recycling technology and subsequent compensation, the parties have agreed as follows: that Michelin is entitled to establish its own recycling plants based on Enviro’s technology; Michelin, when establishing such plants, shall pay an upfront lump sum 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 and that Enviro is entitled to continue establishing recycling plants together with other parties.
“Despite the pandemic and the ensuing delays, we have finalized our agreement regarding a strategic partnership with Michelin. This is an important milestone for Scandinavian Enviro Systems and a significant validation of our technology given Michelin’s position in the global tire market. The protracted negotiations were never part of the plan but on the up-side both Michelin and other international manufacturers had more time to test our recovered carbon black with great results. This and the now reached agreement bode well for the future”, Enviro Chairman Alf Blomqvist, said.
“Reaching a main principles agreement on the content of a Strategic Partnership Agreement was critical for both parties as it sets the course for our common actions in light of our win-win partnership. I am delighted that 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. I am excited to start working on concrete actions in light of our partnership once Enviro has obtained approval by its shareholders vote to move forward together”, Sander Vermeulen, Vice President Marketing & Business Development, Strategy & New Businesses High-Tech Materials at Michelin, said. Vermeulen also serves as director of the board of Scandinavian Enviro Systems.
© Scrap Tire News, January 2021