In the United States (US), Green Plains Inc., a leading agricultural biorefining company has announced that its subsidiary, Green Plains Ord LLC, has entered into an asset purchase agreement with GreenAmerica Biofuels Ord LLC to sell its 65 million (US) gallon (≈ 246 million litre) ethanol plant located in Ord, Nebraska (NE) for US$64 million, plus working capital.
According to a statement, GreenAmerica Biofuels Ord LLC is a newly formed, wholly-owned subsidiary of a privately-held energy company that has maintained significant investments in fuel distribution across North America.
The sale of our Ord, Nebraska plant is another step in our overall “fully funded” strategy to rapidly construct and implement our Ultra-High Protein production technology across our biorefining platform. We believe this sale enables us to create additional value for our shareholders by efficiently deploying capital to support our transformation through technological advancements in proteins, sustainable corn oils, and clean sugars acquired in the recently announced Fluid Quip Technologies transaction, said Todd Becker, President, and CEO at Green Plains.
Green Plains Ord LLC has also entered into an asset purchase agreement with Green Plains Partners LP and its affiliates (Partnership) to acquire the storage and transportation assets and the assignment of railcar leases associated with the Ord ethanol plant for US$27 million, which will be utilized to pay down the Partnership’s debt.
In addition, the storage and throughput services agreement will be amended to adjust the minimum volume commitment to 217.7 million gallons (≈ 824 million litres) per quarter and to extend the maturity date by one year to June 30, 2029.
We believe the value achieved from the sale of the Ord facility begins to demonstrate that we remain undervalued relative to the potential of our portfolio. As we execute on our total transformation strategy, adding additional innovative, sustainable, and clean products produced at our biorefineries through the application of these technologies, we believe our value will continue to increase, concluded Todd Becker.
Green Plains will record a pre-tax gain of approximately US$37 million related to the transaction. Both transactions are anticipated to close within the next 45 days. The purchase agreements are subject to customary closing conditions and contain ordinary and customary representations, warranties, and indemnification obligations.
Ocean Park acted as the exclusive financial advisor to Green Plains and Sidley Austin LLP served as legal advisor to GreenAmerica Biofuels Ord LLC in connection with the transaction.
