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    risks.

    The following risks may be materially relevant but may not always be adequately captured by the summary risk indicator and may cause additional loss: Credit risk, Liquidity risk and Concentration risk. Sustainability risks may lead to a significant deterioration in the financial profile, profitability or reputation of an underlying investment and may therefore have a significant impact on its market price or liquidity. The environmental, social, and governance (“ESG”) considerations discussed herein may affect an investment team’s decision to invest in certain companies or industries from time to time. Results may differ from portfolios that do not apply similar ESG considerations to their investment process.

    glossary.

    Plastic Circularity Strategy

    Growth-stage private equity investment in scalable solutions to plastic waste 
     

    Transforming the plastic value chain into a circular model has produced a market estimated to be USD 1 trillion. Private equity has a role to play in accelerating the scaling of solutions and to close the funding gap between venture and strategic investments. Increasing circularity in plastics mitigates the industry's impacts on climate and biodiversity. 

    plastic: indispensible but problematic
    plastic: indispensible but problematic·transforming the value chain·our plastics strategy·strategy features·why LOIM?·investment philosophy and process·investment team ·insights

    plastic: indispensible but problematic.

    Every year we produce the equivalent of the total mass of the global population in new plastics – effectively the weight of 2.5 mn blue whales. The key problem here is this vast industry follows a linear ‘take-make-waste’ model. 

    Production is problematic because 90% of plastics are created using fossil fuels, generating large quantities of greenhouse gas emissions (‘GHGs’). 

    Usage is often short-lived as nearly half of this volume consists of single-use plastics. This produces vast amounts of waste, which is often poorly managed:

    • 10% is recycled 
    • 26% is incinerated or even burned in open air, emitting carbon and toxic fumes 
    • About 15% releasing into the natural environment, harming nature and biodiversity
       

    transforming the value chain.

    But policy, technology and market forces are driving the formation of a circular value chain for plastics, based on three pillars:

    1. Produce plastic from renewable sources. 
    2. Change the way we use plastic, focusing on longevity rather than single-use
    3. Massively increase the collection, sorting and recycling of plastic waste
    Innovative plastic materials

    Innovative materials that:

    Reduce use of petroleum
    Improve recyclability or compostability 
    Digital traceability

    New usage models

    Products and services that extend the life of plastic goods through re-use, repaid refill or innovative consumer solutions offering the product without single-use packaging

    Improved collections, sorting and recycling

    Technologies that create new/improved sources of recycled content or improve recycling economics or expand types of plastic recycled 
    Expansion of recycling capacity
    Digital enablers

    our plastics strategy.

    Reduce plastic waste

    avoid or recycle waste

    Deliver market returns

    mid-teens net IRR

    Reduce GHG

    in the plastic waste value chain

    Target performance/risk represents a portfolio construction goal. It does not represent past performance/risk and may not be representative of actual future performance/risk.

    Our strategy is designed to reduce plastic waste and GHGs in the plastic value chain while delivering returns, by investing in companies specialising in innovative materials, new usage models and improved collection, sorting and recycling.

    impact_at_scale Driving impact at scale: we will seek to catalyse system-level change in end-to-end plastic value chains in order to significantly reduce volumes of plastic waste, thereby reducing GHG emissions, and ensure scalability by focusing on solutions generating market returns 
    Player_access Unparalleled access to high-quality deal flow and key players in the plastic system: our strategy benefits from privileged access to the technical expertise and the network of the Alliance to End Plastic Waste (‘AEPW’). The AEPW convenes some 70 corporate members from the petrochemical, packaging and consumer goods industries. Our broader network comprises 130 first-tier private-equity managers offering more than 300 co-investment opportunities per year
    largest_fund Our strategy is the largest dedicated to plastic circularity globally: we will predominantly invest at the growth equity stage where the funding gap is the most severe, across a wide scope of solutions, leading to optimal diversification and impact. The strategy has a global profile, with a focus on developed economies where policy, technological and market forces are fostering impactful plastic circularity solutions.

    strategy features.

    • Access to a global private-equity mandate in private equity focusing on growth-stage investments in Europe and the US
    • Strong deal flow from the AEPW, the Plastic Circularity team and through LOIM's relationships in the private equity market with highly experienced Private Equity investors
    • The unique combination of LOIM's private-equity track record with the expertise of the AEPW Technical Solutions Centre, complemented by specialised research from holistiQ, the sustainable-investment platform of LOIM
    • High-conviction investment: we aim to deploy capital in 20-30 select opportunities

    why LOIM?

    Superior sourcing network
     
    • LO Private Equity network of 130 GPs: 300 co-investment opportunities per year. Over the past 3 years c. USD 300 mn within scope of fund 
    • LO Private Equity direct network among generalist and specialist impact funds, strategic and financial advisors  
    • The Alliance to End Plastic Waste (AEPW), with its >70 corporate members, its projects (50 to date in 29 countries) and its Plug & Play incubator program (>100 companies funded )

     

    Superior due diligence capabilities
    Technical expertise 
    • Technical Solutions Center of the AEPW with 5 industry experts (contracted as "technical advisor" to the Fund), and 4 thematic expert groups with 20-30 experts from member companies
    • AEPW’s industry access within (and beyond) their member companies
    Sustainability
    • Lombard Odier Sustainability Investment Solutions research team of 30 researchers 
    • Sustainability consultancy Systemiq and network of carbon scoping consultants

     

    Superior value creation capabilities
    • Strategic market insights: Regulation, new market opportunities…
    • Industry access: 
      • Talent pool (exec and non-exec)
      • Commercial partnerships (customers and suppliers) 
      • Capital partnership
    • Insights on exit routes
    • Sustainability: Carbon scope measurement and reporting, ESG reporting

     

    investment philosophy and process.

    At LOIM, we believe in the potential of sustainability. This conviction is integrated into our investment process, from thematic research to deal selection and ongoing portfolio management.

    Our investment process leverages our expertise to maximise return and impact

    Source: LOIM analysis. For illustrative purposes only. 

    investment team.

    Our multi-disciplinary team combines deep private-equity, sustainability, and technical expertise.

    lead investment team.

    Christopher_round.png Christopher Tritten
    Global Head of Private Assets
    CIO
    locom/_legacy/images/experts/LOcom-AuthorsAM-Ouimet-Storrs Alexandre Ouimet-Storrs
    Investment Director
    locom/_legacy/images/experts/LOcom-AuthorsAM-Chapuis Guillaume Chapuis
    Senior Investment Manager

    sustainable investment research.

    LOcom_AuthorsAM-Hohne-Sparborth.png

    Thomas Hohne-Sparborth, PhD
    Head of Sustainability Research
    LOcom_AuthorsAM-Urban.png

    Michael Urban, PhD
    Chief Sustainability Strategist

    insights.

    Investing for impact: private equity’s role in the plastics challenge
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Investing for impact: private equity’s role in the plastics challenge

    Harnessing private markets to invest in structural shifts: LOIM’s approach
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity StrategyAsset Backed Loan

    Harnessing private markets to invest in structural shifts: LOIM’s approach

    Applying science, scaling innovation for plastic circularity
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Applying science, scaling innovation for plastic circularity

    Throwaway culture is going out of fashion
    equitiesCircular Economy
    equitiesCircular EconomyPlastic Circularity Strategy

    Throwaway culture is going out of fashion

    Plastic wrap: multinationals zero-in on circularity
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Plastic wrap: multinationals zero-in on circularity

    Investing in innovation to reduce plastic waste
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Investing in innovation to reduce plastic waste

    Webinar: building a circular plastics future
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Webinar: building a circular plastics future

    Plastic wrap: private markets, public policy for circularity
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Plastic wrap: private markets, public policy for circularity

    Private equity: investing in a sustainable alternative to microplastics
    private assetsPlastic Circularity Strategy
    private assetsPlastic Circularity Strategy

    Private equity: investing in a sustainable alternative to microplastics

    Plastic wrap: polymer-munching microbes, AI-enhanced sorting
    investment viewpointsInstitutional
    investment viewpointsInstitutionalPlastic Circularity StrategyWholesale

    Plastic wrap: polymer-munching microbes, AI-enhanced sorting

    more insights

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    important information.

    This document is a Corporate Communication and is intended for Professional Investors only. This document is a Corporate Communication for Professional Investors only and is not a marketing communication related to a fund, an investment product or investment services in your country. This document is not intended to provide investment, tax, accounting, professional or legal advice. This document is issued by Lombard Odier Asset Management (Europe) Limited (hereinafter the “Company”).

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