The European Investment Bank (EIB) has signed a EUR 14 million venture loan agreement with Sweden’s Cimco Marine AB to co-finance its innovation and growth investments.
As per the unsecured credit facility agreement, the EIB will finance up to 50 percent of Cimco’s development of a new family of diesel outboard engines, inter alia a 3 liter, 6- cylinder twin turbo BMW diesel engine with a number of power outputs between 200 hp and 300 hp.
"The total facility is split into three tranches of EUR 4 million (A), EUR 4 million (B) and EUR 6 million (C) respectively," it said.
The availability period for the facility is 30 months from signing, during which Cimco can meet all milestones for tranches A-C. At the end of the availability period, Cimco is required to repay its corporate bonds.
European Commissioner Arias Cañete, responsible for Climate Action and Energy, said “The EU is determined to deliver on its commitments to reduce greenhouse gas emissions, and we are working with Member States on their plans to become carbon-neutral by 2050. Cimco’s outboard engine project drastically reduces emissions, while enabling the coast guard and rescue police who use the heavy-duty engines to continue carrying out their work at sea.”
“I am extremely pleased to have EIB as our funding partner. The loan will support us in meeting our growth ambitions, through investment in working capital needs, expanding production capacity and increasing our sales and marketing initiatives," said Myron Mahendra, CEO of Cimco.
Myron added: "Additionally, the company will use the funds to develop its product range whilst improving its efficiency, thereby lowering emission further, as well as reducing other pollutants. Our overarching goal is to continue improving the design of our belt propulsor concept with the aim of significantly reducing the carbon footprint in the high powered outboard marine segment”
In the marine industry, the use of diesel allows for better performance, range and fuel safety. Contrary to engines for cars, marine outboard petrol engines lack the stringent environmental regulations that apply to automotive diesel vehicles, thus creating a lack of incentive for investing in R&D for cleaner technologies.
This has led to a mainstream use of highly polluting petrol outboard engines with old and inefficient technology. Cimco’s diesel engines have reached up to 42% more fuel efficiency, as well as significantly lower emissions in a test setting.
Founded in 2012, Cimco Marine AB (publ) is a Swedish company that has developed OXE Diesel: the first functional, high-power diesel outboard (outside the boat) engine for boats, designed to replace traditional and more polluting petrol outboard engines existing in the market.
