H&M-backed Swedish textile recycling company Renewcell has filed for bankruptcy.
The company filed for bankruptcy in Sweden saying “has not been able to secure sufficient financing” to complete a strategic review with satisfactory results.
As part of the review, Renewcell has had negotiations with its two largest shareholders, H&M and material firm Girindus, its existing lenders and potential new investors as well as other stakeholders regarding long-term financing options.
However, these discussions have not resulted in a solution which would provide the company with “the necessary liquidity and capital to ensure its operations going forward”, it said.
In October 2023, Inditex announced it was going to acquire the first 2,000 tonnes of recycled cotton waste from Renewcell.
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Renewcell chairman Michael Berg said: “I regret to inform that we have been forced to take this decision to file for bankruptcy.
“As we have a strong belief in the company’s long-term potential, we have together with our advisors spent very substantial time and efforts into trying to secure the necessary liquidity, capital and ownership structure for the company to secure its future.
“As part of the negotiations, we have had intense dialogues with both current main owners, new investors and our banks, as well as other stakeholders. However, these discussions have not been successful.
“This is a sad day for the environment, our employees, our shareholders, and our other stakeholders, and it is a testament to the lack of leadership and necessary pace of change in the fashion industry.”
