Armed with $100 million in new capital, an offshoot of apparel brand H&M has emerged from stealth mode by acquiring a Triangle startup that gives it an instant R&D footprint in North Carolina.
Syre, a sustainable venture that recently launched out of H&M and Swedish investment firm Vargas Holding, confirmed plans for a North Carolina operation in March, but declined to give details. The company, with a stated goal to “decarbonize and dewaste the textile industry through textile-to-textile recycling at hyperscale,” now confirms it has bought out UNC-Chapel Hill spin-out Premirr Plastics, a move that establishes an eventual presence in Mebane.
Premirr co-founder Matthew Parrott estimates hiring between 15 and 20 people in the next year in North Carolina, “and that expands massively as we move forward.”
Currently it’s a team of five working in Garner. The plan is to move the North Carolina operation to Mebane in the coming months, Parrott said. Primarily, it will be an R&D facility with a small pilot plant, according to Parrott, who is now R&D director at Syre.
Premirr wasn’t the only company Syre considered as it looked for technology to acquire in order to dewaste the textile industry. Parrott describes a lengthy due diligence process, one that involved Syre analyzing about 20 companies around the globe.
Syre was looking for technologies that were scaleable and commercial, he said. They wanted potential companies to put together business plans, “and we kept passing the bar the whole time.”
Once Premirr was solidified as the pick, the companies did preliminary builds together, “just really learning to work with one another,” Parrott said. Syre executives liked what they saw, actively fundraising the Syre’s $100 million Series A with entities such as TPG and Volvo.
Premirr, which raised about $4 million as a private company prior to the deal, wouldn’t give financial terms of the merger, which transitions it into a wholly-owned subsidiary of Syre.
Parrott and his co-founder, Chris Luft, started what would become Premirr as professors at UNC-Chapel Hill in 2015. The technology breaks down waste polyester material, such as water bottles, food containers and clothing, into marketable monomers, intermediates or additives. The first patent spun out of the lab in 2016. And seed funding started to roll in a year later, prompting them to leave their faculty positions and go all-in on the startup.
According to the Financial Times, H&M along with private equity group TPG and Vargas have committed about $60 million to Syre to build the factory in North Carolina. Specifically, the company is initially focused on polyester recycling. Polyester is found in about 60 percent of clothing and made from fossil fuels like petroleum and coal.
H&M has reportedly signed a $600 million deal with the new startup to buy enough materials to cover half its need for recycled polyester.