LIGNIA Wood Company, a producer of sustainable modified wood, has secured £7.5 million, comprising £3 million funding from London-based investment manager Downing LLP, £2 million from the Development Bank of Wales and £2.5 million from existing investor Woodford Investment Management.
The investment is to support the construction of its first commercial production facility in Barry, Wales.
The company is helping to tackle issues around the limited supplies of legal and sustainable hardwoods – such as reducing deforestation and increasing sustainability awareness – by producing a modified timber with the brand name LIGNIA®.
LIGNIA is manufactured from pine sourced from sustainably-managed plantations which is impregnated with resin to make a modified timber that has a better appearance, durability, stability and fire resistance than many high value hardwoods such as oak and teak.
The £7.5 million funding from Downing, the Development Bank and Woodford Investment Management will help support the development of LIGNIA Wood Company’s first commercial scale production plant able to produce up to 15,000m³ annually, in the Vale of Glamorgan.
Downing LLP is a highly experienced investment manager with over 35,000 investors. The business has raised over £1.7 billion into businesses across a range of sectors, from renewable energy, care homes, health clubs, and children's nurseries, to technology and sports nutrition.
The investment manager recently opened a brand-new office in Cardiff, which will form a technology centre for the business. Downing chose Cardiff as its location due to its reputation as a home of exciting fintech companies.
Duncan Gray and Dr. Richard Thompson from the Development Bank’s Technology Venture Investments team collaborated with Downing on all aspects of due diligence. Dr. Thompson in particular has extensive international experience of working with the timber sector and with modified wood.
Commenting on the funding and Downing’s business growth, Sean Moore, Investment Director at Downing, said:
“We are constantly striving to find exciting businesses in new markets. LIGNIA is a great example of this, as a product with a clear technical advantage for which there is already high demand.
“Wales is proving a very interesting place for us to find opportunities at the moment, whether it’s amongst the technical talent in Cardiff or innovative local businesses like LIGNIA Wood Company outside the capital.”
Duncan Gray, Deputy Fund Manager at the Development Bank of Wales commented:
“We are delighted to co-invest with Downing again and with Woodford Investment Management. The high-quality management team at LIGNIA has developed a fantastic alternative to hardwoods that has clearly impressed customers in the UK and internationally.”
Hans Ng, CEO at LIGNIA, added:
“With supply of many hardwoods constrained due to regulation, this has opened the market for modified wood, making now an excellent time to expand our business. The teams from Downing, the Development Bank of Wales and Woodford Investment Management have demonstrated great expertise and a track record in investment in sustainability sectors which has made them a logical fit for us and we are very excited to be working with them.”