en.Wedoany.com Report on Mar 23rd, Swedish material technology company PaperShell recently signed a €40.3 million innovation fund grant agreement to advance the production expansion of its patented bio-based composite material. This material, based on kraft paper, is transformed into load-bearing components with fossil-free carbon. It is stronger than plastic, lighter than metal, and offers versatility similar to fiber composites, helping European manufacturers replace greenhouse gas-intensive materials in sectors like construction, transportation, and consumer goods.

PaperShell's proprietary process produces fiber-hardened kraft paper-based components, offering diverse shapes, patterns, and designs to meet the aesthetic and technical requirements of various applications. The funding will primarily be used to expand the existing production facility in Tibro, Sweden, adding 12,300 square meters to reach a total area of 15,600 square meters. This expansion will accommodate automated, modular composite production lines. The factory is planned to utilize a wooden structure with PaperShell exterior walls and will primarily rely on solar power. It is projected to have an annual design capacity of approximately 23,000 tons by 2030, producing components for industries such as construction, transportation, furniture, electronics, and defense.

This expansion marks a significant step for Europe in transitioning to large-scale production of fossil-free, bio-based composites. Prior to this, in December 2025, PaperShell successfully raised 150 million Swedish kronor (approximately €15 million) in a fully oversubscribed funding round. This attracted existing shareholders as well as institutional and private investors, including DNB Asset Management (Norway), Kistefos (Norway), Course Corrected (Sweden), and the Carrick Family Office (Sweden). This series of financial support will accelerate PaperShell's expansion in the bio-based composite market, contributing to the sustainable development of European manufacturing.