Eastman Chemical Company (NYSE: EMN) has joined hands with the French government, and will invest up to $1 billion to build the world’s largest molecular plastics recycling facility in the country.
The collaboration aims to accelerate the circular economy, address the global plastic waste crisis, and protect the planet for future generations.
Details of the Agreement
According to the long-term partnership, France and Eastman will collaborate to help the EU achieve its sustainability goals, by reducing carbon emissions and enabling a circular economy.
With the help of Eastman’s proven polyester renewal technology, the planned facility will annually recycle up to 160,000 metric tons of hard-to-recycle plastic waste that is currently being burnt up. Furthermore, the facility will also create virgin-quality material, with a much lower carbon footprint.
The collaboration will be executed in multiple phases and will include building several units, including a unit to prepare mixed plastic waste for processing, a methanolysis unit to depolymerize the waste, and polymer lines unit to create first-quality materials for specialty, packaging, and textile applications.
Additionally, Eastman will open an innovation center to introduce alternative recycling methods and applications to enable France to sustain a leadership role in the circular economy. Expected to be operational by 2025, the center will generate employment for 350 people and an additional 1,500 indirect jobs in recycling, energy as well as infrastructure.
Management Weighs In
CEO Mark Costa, commented, “The investment in France is a significant step forward in Eastman’s strategy to accelerate a circular economy globally. France has demonstrated their commitment toward a sustainable future and Eastman has set similar, ambitious carbon and circular economy goals.”
Looking ahead at the future, he added, “Today’s announcement is a key milestone towards our commitment, and we expect to achieve additional milestones in the coming months, including agreements related to securing the plastic waste that will be raw material supply, securing government incentives, and the site location decision.”
The Wall Street community is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on 11 Buys and 4 Holds. The average Eastman Chemical stock forecast of $137.80 implies 8% upside potential to current levels.
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