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When Swedish textile recycling company Renewcell filed for bankruptcy in February, it sent shock waves through the sustainable fashion sphere. Now, Stockholm-based investment firm Altor has acquired Renewcell’s remaining assets for an undisclosed sum.
Renewcell will be renamed after its hero innovation, Circulose, a material produced from recycled cotton clothing that replaces the wood pulp traditionally used for man-made cellulosic fibres such as viscose. Since it went into production in 2019, the material has been piloted by brands including Ganni, Levi’s, Tommy Hilfiger parent PVH and Inditex-owned Zara. H&M was one of its largest shareholders, alongside Swedish investment firm Girindus.
“We don’t shy away from a challenge and this one is worth taking,” Altor principal Clara Zverina said in a statement. “Both for the uniqueness of the patented technology and the urgency of scaling circular solutions for the entire textile and fashion industry, particularly to replace virgin cotton and MMCF (man-made cellulosic fibres). We are determined to partner with key stakeholders across the value chain to together unlock the potential of Circulose.” The firm’s investment portfolio ranges from alternative steel producer H2 Green Steel to Scandi fashion brand Toteme.
Once a sustainable fashion darling, Renewcell’s failure proves systemic change can’t happen without significant industry overhaul.
Renewcell went public in November 2020, with many questioning at the time whether the company was ready. Having debuted on Nasdaq First North with an offering price of SEK 76 per share ($7.26 at today’s exchange rate), Renewcell saw share prices plummet by 77 per cent by October 2023. In November, it announced a strategic review, which it was unable to complete — at the time of the bankruptcy, the company said in a statement that it had failed to secure sufficient financing despite “well-advanced negotiations” with shareholders.
When the company opened its production facility in Ortviken, Sweden, in 2022, it hoped to become one of the first next-gen material companies to reach commercial scale. The plant was intended to produce 120,000 tonnes of Circulose annually — which the company said was equivalent to more than half a billion T-shirts. Shortly after the bankruptcy announcement, Renewcell’s chief commercial officer Tricia Carey told Vogue Business that the company had enough pulp and fibre produced to last its brand partners 18 to 24 months. Circulose says this stock is already in the market, and its brand partners have continued to work on developments since the bankruptcy.
For all its limitations, Renewcell was considered a front runner in next-gen materials. Many saw its failure as a wake-up call for brands. Without investment and meaningful support from brands willing to take a leap of faith, innovators would never break through. Whether the industry is ready to support Renewcell this time around remains to be seen.
“We extend our deepest gratitude to our customers, partners and stakeholders for their unwavering support and collaboration during this journey,” Circulose CEO Magnus Lundmark said in a statement. “Together, we will continue to drive positive change, leveraging Altor’s expertise and resources to enhance our capabilities and secure a confident future for Circulose and the broader textile community.”
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