Ethanex Inks Agreement to Acquire Nebraska Ethanol Plant
Submitted by DTN Ethanol Center
WARWICK, N.Y. (DTN) — Ethanex Energy said in a news release that it has inked a definitive agreement to acquire Midwest Renewable Energy’s 26-million-gallon-per-year ethanol production plant in Sutherland, Neb., for $220.0 million in cash and Ethanex stock. Under the agreement, several newly formed, wholly owned subsidiaries of Ethanex will acquire the ethanol production facility in a series of three transactions.
At the first closing, Ethanex will acquire the existing ethanol production plant for $50 million in cash. The existing plant is currently undergoing a two-phase expansion. Each expansion phase is designed to add an additional 42.5 million gallons per year of production capacity for a total projected plant capacity of 111 million gallons per year. At each of the three closings, Ethanex will receive $2.0 million of inventory, which is included in the purchase price.
After the initial closing, Midwest Renewable will be responsible for continuing and completing the two-phase production plant expansion. In two subsequent closings, Ethanex will acquire each of the expansion phases. The second and third closings are subject to testing and certification of the plant expansions in accordance with construction and performance specifications contained in the agreement. Ethanex will pay Midwest Renewable $60 million in cash and $25 million in Ethanex common stock at each of the second and third closings. It is estimated that the final closing on the plant by Ethanex will occur in the first quarter of 2009.
Ethanex said it will also build and add its integrated fractionation platform, developed in collaboration with Buhler, Inc., to the Sutherland facility that is expected to increase total plant capacity to 132 million gallons per year.
Ethanex is a renewable energy company based in Basehor, Kansas, with offices in Santa Rosa, California, and Charleston, South Carolina.
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