The termination between Loop and SK Geo Centric aligns with Loop's strategic shift towards investing in regions with lower operating costs and a focus on licensing and engineering services in markets with higher expenses.
Concurrently, SK Group is undergoing strategic changes that have influenced this decision, Loop noted in the SEC filing.
Despite the termination of the JV, SKGC remains financially invested in Loop and retains its right to appoint a director to Loop's board.
However, SK geo centric's Green Business Division Vice President Jonghyuk Lee stepped down from his board position on 13 January, due to a new assignment within SKGC's restructured organisation.
The Singapore-headquartered JV, forged on 27 April 2023, aimed to establish and manage an Infinite Loop production site in Ulsan, South Korea.
SKGC holds a majority stake of 51% in the venture, which was granted exclusive rights to use Loop's technology across Asia for a set duration.
The first facility planned in Ulsan was expected to produce up to 70,000 metric tonnes annually of PET resin for packaging and polyester fibre applications.
In related developments, Loop's collaboration with Ester on the Infinite Loop India manufacturing plant is advancing towards commencement of construction.
Gujarat, an Indian state, has been selected as the site for this project due to its advantageous infrastructure, port accessibility, renewable energy prospects, and availability of waste PET and polyester materials. The partners are finalising land acquisition details in the region.
The Gujarat facility is slated for the second quarter of 2025. The completion of construction is projected by late 2026 with commercial operations starting in 2027.
Positioned to meet circular fashion brand demands for T2T polyester, the India-based joint venture aims to utilise local waste polyester resources to produce resin entirely from textile waste for apparel brands.
Additionally, Loop is cultivating expertise and partnerships within the polyester fibre supply chain to provide specific customers with polyester fibre instead of resin.
Loop said that it has “qualified Loop’s fibre for brands with large spinning companies in various geographical regions”.
Loop Industries founder and CEO Daniel Solomita said: “Our Indian joint venture is progressing as planned. We have witnessed strong customer engagement within the circular fashion sector, driven by Loop's unique ability to provide virgin-quality polyester fibre to fashion brands through our innovative textile-to-textile recycling technology. We have further expanded our product offerings to include spun polyester fibre, enabling us to become a Tier 3 supplier and broaden our reach within the fashion industry. To effectively serve our customers, we've established a global network of spinning partners who will collaborate with Loop."
In December, Loop Industries obtained €10m ($10.3m) financing through a convertible preferred security arrangement with the investment entity Reed Societe Generale Group, which is controlled by Societe Generale bank.
