Spinnova: Suzano withdraws from collaboration, forcing major strategic review

Translation: Original published in Finnish on 2/28/2025 at 9:13 am EET.

Spinnova announced today that Suzano has informed the company that Suzano does not intend to invest in the next steps of the collaboration. Following Suzano's decision, Spinnova currently does not expect Suzano to invest in a factory in the near future. Suzano commented that this business decision is based on the company's newly defined priorities and capital allocation strategy and is not related to the lack of confidence in the technology on which Suzano's investment decision was originally based. Suzano continues to be a shareholder in Spinnova.

Spinnova and Suzano have jointly agreed to initiate a strategic review of their joint venture Woodspin, which is expected to be completed in the coming months. Spinnova continues to see significant interest from other parties in its fiber and technology. Therefore, the review will also assess the conditions for terminating the exclusive rights of the joint venture agreement. Spinnova continues to execute on its proprietary technology plan, including its proprietary MFC concept, as previously announced.

In parallel with the Woodspin review, Spinnova is launching a review of its strategy, including all joint ventures, and is planning future actions. The company reviews its strategic objectives and financial guidance for 2025. Spinnova expects the strategic review to be completed in the coming months and will inform the market immediately thereafter.

Withdrawal of key partner is negative news for Spinnova

The news is very significant for Spinnova's investor story, as the development of Spinnova fiber for pulp-based materials is the most advanced and Suzano was practically Spinnova's only strategic partner for wood-based materials. Suzano's investments represented a significant portion of Spinnova's projected revenue. The news is not a complete surprise given H2's stalled technology development, but it is still a major disappointment and drives Spinnova to address significant strategic issues. At the same time, the commercialization of Spinnova's technology is likely to be delayed and slowed down. We expect that the decision will also require Spinnova to adjust its costs in the near future.  

According to our preliminary assessment, Spinnova's strategic options include at least finding a new partner or partners interested in manufacturing investments for the commercialization of pulp-based materials, a stronger focus on other materials and even the sale of the technology portfolio to a third party. Spinnova's cash position at the end of Q4 was 41 MEUR, so Suzano's decision will not cause Spinnova any immediate financial problems, but with a likely prolonged period of negative cash flow, the company has no time to waste on strategic decisions.