Comanche Clean Energy announced that it has completed a private placement round of financing of $85 million in units of new senior secured notes and common stock.
In addition, it has exchanged $48 million of existing senior secured convertible notes and related warrants in return for new senior secured notes, common stock and $8.9 million in cash. The effect of the transactions will be to increase the book equity of Comanche from approximately $30 million to approximately $109 million, and total capitalization from approximately $140 million to approximately $225 million.
The aggregate $85 million in net transaction proceeds supplements the $45.5 million in common equity and debt that Comanche raised from existing investors on December 19, 2007. Imperial Capital, LLC acted as exclusive financial advisor to the Company in connection with these transactions.
Comanche is utilizing the majority of these proceeds in its Canitar ethanol facility which is located in the southwestern region of the State of Sao Paulo, Brazil. The Canitar mill is scheduled to commence commercial operations in early September this year, with an initial annual crushing capacity of 1.2 million tons or 100 million liters of annual ethanol production.
The facility will be the most modern in Brazil to date, the company says, with an integrated operations center that will reduce manpower requirements by 50% from other similar facilities. Comanche plans to further expand the facility to 2.4 million tons of annual crushing capacity which will include an intermodal facility to facilitate product shipment by rail and truck.
"We are pleased to have completed this round of financing," commented Chairman Tom Cauchois, "which will enable us to ramp production at the Canitar facility later this summer to about 100 million liters on an annualized basis. Later next year, we intend to expand the facility which will bring total annual production capability at Canitar to 200 million liters."
Mr. Cauchois added that "the market for our products in Brazil is very strong right now: the demand for fuel ethanol has increased 46% to date this year in Brazil, while the sugar cane harvest through June has increased production of ethanol by only 7.2%."
With the most recent round of financing, Comanche plans to expand further to reach annual ethanol production capacity of 300 million liters of ethanol production by the end of 2010.
About Comanche Clean Energy, Inc.
Established in 2006, Comanche Clean Energy is a vertically-integrated Brazil-based producer of ethanol and biodiesel. Comanche owns and operates the Santa Anita and Canitar ethanol facilities and the Bahia biodiesel facility.
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