AgStar Financial Services’ lending group announced the sale of two
ethanol plants recently acquired through VeraSun Energy’s bankruptcy.
Green Plains Renewable Energy (Nasdaq: GPRE) has agreed to purchase the
production facilities located near Central City and Ord, Nebraska.
Purchase agreements have been signed and the sales of these facilities
are expected to close in June.
Green Plains said it plans to have the plants fully operational within 30-60 days of the sale closing.
This purchase agreement represents the AgStar lending group’s third plant sale in a two week period. Carbon Green BioEnergy recently signed an agreement to purchase the Woodbury, Michigan plant.
Green Plains Renewable Energy’s ethanol production capacity will be
increased by 45%, from 330 million gallons to 480 million gallons per
year, once the purchase is completed.
"The acquisition of the plants in Central City and Ord lowers our cost
of production and improves our ability to compete in the industry,"
said Todd Becker, Green Plains’ President and Chief Executive Officer.
"This purchase is consistent with our strategy to selectively acquire
assets at reasonable valuations that provide long-term benefits to our
shareholders. The Central City and Ord plants share the same process
technology deployed at the majority of our plants, which should allow
us to integrate them into our business with little disruption."
AgStar will continue to lead a group of lenders in financing these two plants.
Paul DeBriyn, president and CEO of AgStar Financial Services,
said: "Based on nameplate capacity, plant sale prices have been well
within the range of what we expected to receive for these valuable
assets." AgStar’s lending group continues ongoing discussions with
qualified buyers for the three other ethanol plants acquired in April.
"It takes a fair amount of time to work through the sales process for
this type of facility, but we’ve made great progress so far."
Green Plains Renewable Energy, Inc is based in Omaha, Nebraska.
Green Plains is a vertically-integrated, low-cost ethanol producer
operating four ethanol plants in Iowa, Indiana and Tennessee with a
combined expected operating capacity of 330 million gallons of ethanol
per year.
Green Plains also operates an independent third-party ethanol marketing
service, with marketing capacity of 305 million gallons of ethanol per
year. Green Plains owns 51% of Blendstar, LLC, a Houston-based biofuel
terminal operator with 6 facilities in 5 states. Green Plains’
Agribusiness segment operates grain storage facilities and
complementary agronomy, feed, and fuel businesses. Green Plains has
grain storage capacity of approximately 22 million bushels.
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