Battery recycler Redwood likely on verge of multi-million funding deal

Battery recycling company Redwood Materials, founded by former Tesla CTO JB Straubel, is well on its way to raising another 700 million dollars in capital to fund its expansion. This is apparently to finance another recycling plant in Nevada.

Talks with investors are well advanced but not yet concluded, reports the Financial Times. The new round of financing, in which several existing investors also want to participate, is expected to raise the company’s valuation to almost five billion US dollars.

Since its inception, Redwood has been backed by major investors, including asset managers T. Rowe Price, Baillie Gifford and Fidelity. Later investors have included Breakthrough Energy Ventures, Goldman Sachs and Amazon’s Climate Pledge Fund. However, the FT informants only spoke of “several of its existing investors” taking part in the new capital raising – but the number or their names were not mentioned.

Redwood Materials had already raised more than 700 million dollars in July 2021. In February 2023, Redwood received a conditional commitment from the US Department of Energy for a loan of two billion dollars.

The money would “finance Redwood’s development of a battery recycling facility near Reno, Nevada.” However, money from the loan will also be used for the large plant in Reno. The factory planned in Nevada is expected to be able to produce battery materials for more than one million electric cars a year at full capacity, according to the FT.

At the Tahoe Reno Industrial Center, not far from Tesla’s Gigafactory 1, Redwood already has a number of facilities and produces, among other things, copper foil from recycled material that is supplied to Panasonic at the same Gigafactory 1.

The company already announced in September 2021 that it would not only recycle old batteries and production rejects, but also produce new battery materials from the raw materials obtained in this way. Redwood is already building such a site, which combines recycling and battery material production, in South Carolina near Charleston – with an investment volume of 3.5 billion dollars.

ft.com (paywall)