Euglena Co Ltd and Oriental Air Bridge Co Ltd (ORC) announced that they have agreed to form a capital alliance Nov 29, 2017.
Euglena is a company that engages in the development of bio jet fuel, and ORC is a company that is based in Omura City, Nagasaki Prefecture, Japan, and operates an airline in the area of isolated islands of Nagasaki Prefecture.
Based on the agreement, Euglena will underwrite the third-party share issuance of ORC, obtaining 4.7% of ORC's common shares and becoming the third largest shareholder.
In the aim of realizing fare-paying flight using bio jet fuel by 2020, Euglena started to build a plant for testing bio jet diesel fuel in June 2016. The plant is scheduled to be completed in October 2018 and start operation in early 2019.
With the alliance, Euglena aims to obtain knowhow to supply bio jet fuel and experience of using it, raise the profile of the Euglena brand/products among ORC's customers and in ORC's service area and obtain expertise in air transportation business.
ORC uses Nagasaki Airport as its base and manages air routes between, for example, isolated islands of Nagasaki Prefecture (Iki, Goto Fukue and Tsushima) and Kyushu (Nagasaki and Fukuoka). For each route, ORC conducts a code-sharing flight with Japan Airways Co Ltd.
Based on the alliance, ORC plans to enhance its brand by employing bio jet fuel, promote its airline and service area with help from Euglena and obtain knowhow to promote the development of isolated islands from Euglena, which has accumulated the knowhow at its production base in the Yaeyama region of Okinawa Prefecture.