£5m investment into ECO Plastics

Ludgate Environmental Fund Limited

£5m investment into ECO Plastics

Part of £24m fund raise to drive expansion with

Coca-Cola Enterprises and Close Brothers Leasing

Ludgate Environmental Fund Limited ("LEF") is pleased to announce that it has invested £5 milllion into preference shares of ECO Plastics Limited ("ECO Plastics"). ECO Plastics is Europe's leading plastic bottle recycler. This investment is part of a £24 million capital raising by ECO Plastics to fund the expansion of its recycling facilities at Helmswell in Lincolnshire. The plant aims to more than double British production of food-grade recycled material for soft drinks packaging.

The expansion funds will be financed by the £5m equity investment by LEF, the £5m from Coca Cola Enterprises via the joint venture, and with the balance funded through new banking facilities from Close Brothers. These funds will support the construction and operation of an expansion to ECO Plastics' existing plastics processing plant, as well as the investment required to build and operate the Joint Venture business that will supply food grade recycled material ("rPET") to Coca-Cola Enterprises over the next ten years.

ECO Plastics' facility in Hemswell, Lincolnshire, is already the largest and most sophisticated in Europe. The expansion, which secured planning approval in May, will increase overall processing capacity at the plant from 100,000 tonnes to 140,000 tonnes of plastic bottles per year, just under half the total collected in the UK last year. The expanded facility will be fully operational during 2012.

Bill Weil of LEF will join the Board of ECO Plastics as a director.

Peter Gangsted, chairman of ECO Plastics said: "We will recycle used British packaging in Lincolnshire, for re-use in packaging sold in Britain. This represents an important milestone for both the drinks manufacturing industry and the recycling industry. We are delighted that the markets have recognised the value of this model. The UK sustainable packaging market has huge growth potential and our expansion will make ECO Plastics a world leader."

The £5m investment by Ludgate Environmental Fund represents 8.6% of assets under management by LEF. Bill Weil, Chief Investment Officer of Ludgate Investments Limited, said: "Ludgate Environmental Fund is delighted to have co-funded this expansion and is very pleased to work alongside the strong management team at ECO Plastics. The relationship with the Joint Venture business formed with Coca-Cola Enterprises gives us huge confidence in the future of ECO Plastics and the PET reprocessing industry in the UK. This deal is an important step for the future of ECO Plastics in a regulatory environment where increasing recycling rates and landfill taxes highlight the importance and benefits of greater resource efficiency."

Ludgate Environmental Fund Limited will join the Sam Group and Disruptive Capital Finance as investors in ECO Plastics.

About Ludgate Environmental Fund

Ludgate Environmental Fund invests in a diverse portfolio of late stage companies in the European cleantech sector. Actively managing its holdings, the Fund invests growth capital with a focus on waste and recycling; renewables; energy efficiency and water.

Ludgate Environmental Fund was launched in August 2007 and has assets under management of circa £60m. The Fund is a Jersey domiciled closed-ended investment company, quoted on AIM under the symbols LEF.L for the shares and LEFW.L for the warrants.

Further information can be found at www.ludgateenvironmental.com

About ECO Plastics

ECO Plastics is Europe's largest recycler of mixed plastic bottles. The business operates the most technically advanced plastic recycling facility in Europe. Our superior cleaning technology allows us to make the most use of the plastic we sort, producing 11 different streams of plastic, including food-grade recycled content (rPET) suitable for soft drinks packaging.

Further information can be found at www.ecoplasticsltd.com or from [email protected]

About the Joint Venture business

ECO Plastics and Coca-Cola Enterprises ("CCE") announced in March 2011 their intention to establish a Joint Venture recycling business in Hemswell more than doubling the amount of high quality rPET produce in Britain.

The state of the art plastics reprocessing plant will also supply CCE with enough GB sourced, high-quality rPET to achieve CCE's target of including 25% rPET in all its plastic packaging in GB by 2012. This represents an important milestone in CCE's ongoing work to develop the most sustainable packaging possible.

For further information contact:

Ludgate Environmental Fund:

Chairman, John Shakeshaft 0044 (0) 1534 609 233   

Ludgate Investments Limited:

Bill Weil 0044 (0) 207 621 5770

ECO Plastics:

Oliver Williams (Financial Dynamics) 0044 (0) 207 269 7294

NOMAD - PricewaterhouseCoopers LLP:

Krysia Sturgeon 0044 (0) 207 212 5504

Broker - Matrix Corporate Capital LLP:

Paul Fincham 0044 (0) 203 206 7175