Review: Firglas EIS Ltd

Global population is set to reach 9.8 billion by 2050. By then we will consume two-thirds more protein than we do today. But how can we meet this growing demand? 

Algae, which can contain up to 65% protein – three times as much as beef – could provide an answer. After deploying more than £150 million into bioenergy and algae production projects, Firglas Ltd is now raising £3 million of equity to build two plants and start algae commercial-scale production.


  • Proven technology, process and products – market ready
  • Demand outstrips supply 
  • Highly experienced team has previously deployed over £150 million into similar projects
  • Co-invest alongside specialist institutional investor
  • Strong balance sheet with good second-hand values of equipment
  • Strong pipeline of potential clients
  • Target return of 2.4x after year three based on prudent estimates – not guaranteed
  • Minimum investment £10,012.20

Watch a video interview with Fredrik Adams, Founder & CEO of Firglas Ltd EIS

The offer

This is an exciting opportunity to co-invest in an EIS-qualifying company operating in an emerging, fast-growing global industry. The management’s ambition is to turn Firglas into a market-leading supplier of quality algae-based ingredients for the fish feed, food supplements and alternative protein markets. 

Firglas was set up in 2013 by a highly experienced management team. Its original objective was to develop, build and operate renewable energy plants, which it did successfully, deploying £8 million. At the same time, it also started pursuing algae projects, working with some of the leading companies in the sector.

The team behind Firglas has worked with the leading global companies on developing algae projects and algae-based products. It has raised and deployed more than £150 million into bioenergy and algae production projects since 2009 and has now decided to enter the market itself. 

For the past four years, members of the Firglas team have been operating a pilot algae plant south of Rotterdam in the Netherlands. They wanted to refine the algae production and harvesting processes on a small scale before entering the commercial-scale production phase. 

During the pilot phase, Firglas has been promoting its sample products to potential customers and already has expressions of interest from several companies including letters of intent from Biomar, a global producer of fish feed for aquaculture and Barentz, a leading provider of ingredients for the pharmaceutical, personal care, food and animal nutrition industries.

Now Firglas wants to apply those processes on a much larger scale. So, it is seeking to raise up to £3 million by issuing 124,000 Ordinary Shares at a price of £24.42 per share to fund the premises, fixtures, and fittings and provide working capital to construct and operate two algae cultivation facilities in the Netherlands and Spain.

The same team which has been operating the pilot plant will manage the build of the new sites. The production team, led by Peter van den Dorpel, has built several demonstration and pilot plants in the Netherlands, Italy and Portugal.

A specialist EIS fund has already committed £1 million. The remaining £2 million is available exclusively to Wealth Club investors. 

Target returns

The management intends to build a valuable and highly cash-generative company.

The first step is to start commercial-scale production of algae ingredients for the fish feed and food supplement industries. Once the target productivity levels and costs of production are met, the management may adopt new IP-led processes to develop higher-value products and may consider registering patents.

Each plant is expected to have a life of 15 to 20 years. Over this period significant profits and cash are expected to be generated.

That said, the management is keenly aware some investors may want an early exit (after three years). For those investors, the target return is 2.4x (after tax relief) and 1.7x (before tax relief) after year three. This is based on prudent estimates, e.g. on fish feed, the lowest-margin product, representing 80% of the product mix. Any shift in the product mix shift towards higher-value products should enhance investor returns. Investors willing to remain invested for a longer period could achieve significantly higher returns. 

Please note, though, returns and timescales are not guaranteed.

Management team

The management team has individual and collective track records of developing projects, securing finance, constructing, operating and successfully exiting international bioengineering plants. Since 2009 the team has raised and deployed more than £150 million into algae production and bioenergy projects.

High-profile investors who have previously backed projects led by CEO Fredrik Adams include Stephen Lansdown (co-founder of Hargreaves Lansdown), Gordon Power (formerly CEO of ProVen Private Equity) and Lord (Jacob) Rothschild. 

Collectively, the management has personally invested more than £1 million into Firglas since inception.

Exit strategy

We understand the management intends to remain with the business long enough to help the Company realise its full potential. 

As with all EIS companies, there is the option of a trade sale, a sale to another financial investor, refinancing or a stock market listing. There is a great deal of activity and investment in the sector. We believe if Firglas achieves its plan it may get interest from a range of large industrial operators or achieve a good value rating on IPO, although this is not guaranteed. Exit options for investors wishing to crystallise value are expected to be available from year three. Timeframes and exit options are not guaranteed.

What to consider

This is a high-risk single company investment: capital is at risk. Please ensure you read the report and the Information Memorandum carefully, and make sure you understand the considerable risks of investing. You should not invest money you cannot afford to lose. Returns are not guaranteed. Details of the charges are also covered in the offer documents. The value of tax benefits depends on circumstances and tax rules can change. 

Our view

We believe this is an interesting and compelling, albeit high-risk, opportunity with potential for attractive returns for experienced investors. 

Significant R&D led by Europe to develop new technologies and processes to harvest algae on commercial scale is paving the way for those willing to invest in this emerging market. Large industrial operators are setting their sights on algae. However, it is still a young market with significant opportunities for experienced new entrants. 

The demand for quality, traceable algae ingredients for the feed and food market outstrips supply.

Firglas seems to be well positioned to scale up and is led by a management team that has successfully developed businesses in similar sectors before. If the Company can ensure productivity and in turn keep production costs low, it could potentially grow significantly quicker than its forecasts. The management has a well developed pipeline of customer leads but still has to convert pipeline to sales. If Firglas can achieve this, we believe it has a tremendous opportunity to scale up very quickly penetrating food and feed ingredients markets and becoming a highly attractive target for a large industrial player. 

We believe the pre-money valuation of Firglas to be sensible, reflecting the early stage and risk profile of the Company. If it achieves its plan we think it could potentially be worth well into double digits multiples based on the activity we have seen in the sector, and target return could be exceeded. The longer-term opportunities seem also appealing should it achieve its 3 to 5-year plan. As with all EIS investments there is the chance that things won’t go according to plan: you should form your own view.

Investors have the benefit of EIS tax relief as well as the comfort of co-investing alongside a highly regarded EIS fund.

Wealth Club aims to make it easier for experienced investors to find information on – and apply for – tax-efficient investments. You should base your investment decision on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice or a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.

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