Agstar Financial Services will buy six of the seven VeraSun Energy Corp. ethanol plants that it financed.
A Delaware bankruptcy court approved the Agstar’s $324 million credit bid to purchase the facilities. The seventh facility was bought by Valero Energy Corporation (NYSE: VLO).
VeraSun filed for bankruptcy in November 2008.
Agstar said the six plants will remain in ‘idle’ mode for an estimated 60 days while buyers are secured.
The plants are located in five upper-Midwest states and are capable of producing 470 million gallons of ethanol annually.
Paul DeBriyn, President and CEO of AgStar Financial Services stated, “This purchase will protect the interests of AgStar stockholders and our fellow creditors in the lending group. That’s what this credit bid accomplishes. Basically, we’ve taken the necessary steps to ensure these plants will be sold for fair market value. These facilities, and the people working at them, are highly valued assets.” The purchase is expected to close in April.
AgStar said it has received ample interest in the plants from potential buyers.
“Our goal is to have these plants sold as quickly as possible. This is vital so that corn will again be purchased from local sources, jobs will be brought back to rural America, and the renewable fuels industry as a whole will be reinvigorated.”
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