Ludan Engineering Co. Ltd. (TASE: LUDN) cleantech subsidiary Lextran Ltd. has raised $1.2 million at a company value of $7 million before money.
Eitan Establishment of South Africa invested $750,000, Ludan invested $100,000 and other existing shareholders invested $350,000. In the wake of the financing round, ownership in Lextran is as follows: Ludan - 27.4%, down from 31%; Eitan Establishment - 9.15%; Meytag Technology Incubator 2%; and private investors - 52%.
Ludan said that it was reviewing the effect of the investment on its results. Ludan CEO Arnon Aharon said that it might report a small capital gain on the dilution of its stake in Lextran. “The important thing is the entry of foreign investors into the company,” he said.
Lextran is developing a low-operational cost installation for reducing emissions of nitrogen oxide and sulfur oxide to the atmosphere by power stations. The company claims that the technology handles both emissions simultaneously in a single process, whereas competing technologies require different technologies and facilities for the different gases in order to comply with environmental standards.
Ludan says that Lextran’s single technology for both nitrogen oxide and sulfur oxide cut set-up costs by 40% and operating and maintenance costs by 50%. The company added that Lextran uses a proprietary catalyst in its system.
The US already uses an emission trading scheme, and the market is worth an estimated $7.5-9 billion a year, and is expected to grow exponentially. Since Lextran’s technology reduces both nitrogen oxide and sulfur oxide to negligible levels, and the emission standard is higher than zero, customers can potentially benefit from the emissions trading mechanism on the basis of the difference between the actual emissions and the standard.
Lextran launched a unit at a 25-megawatt power station in Ishi, Romania, this month.
Published by Globes [online], Israel business news - www.globes.co.il - on October 11, 2007
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