Graanul Invest enters the US with planned acquisition
In the United States (US), Woodville Pellets, LLC an affiliate of Estonia-headed AS Graanul Invest has recently revealed that it has submitted the winning bid in the auction conducted on May 9, 2019, for the assets of Texas Pellets, Inc. and German Pellets Texas, LLC – collectively Texas Pellets. The assets include Texas Pellets’ Woodville, the wood pellet manufacturing facility and the Port of Port Arthur storage and shipping terminal.
According to a statement, the transaction received preliminary approval by the United States Bankruptcy Court for the Eastern District of Texas after a hearing held on May 15, 2019. The approval is subject to the entry of a final order, planned to be finalized by June 15, 2019.
In connection with the acquisition, Graanul Invest received financing from funds managed by affiliates of Apollo Global Management, LLC.
The estimated manufacturing capacity of the wood biomass pellet plant in Woodville, Texas (TX) is 450 000 tonnes per annum (TPA). The Port of Port Arthur terminal in Texas has a total storage capacity of 68 000 tonnes and is capable of loading vessels up to approximately 60 000 tonnes.
The other “Chapter 11” bankruptcy asset of German Pellets US subsidiaries, Louisiana Pellets, was acquired by UK power major Drax Group in April 2017.
Access to Asian markets
The acquisition of Texas Pellets’ assets enables Graanul Invest group to expand its business to the United States to ensure greater security of supply to its customers. It also provides better logistical solutions for entering the Asian market, in particular, the fast-growing markets in Korea and Japan.
With 11 pellet plants located in the Baltics, Graanul Invest group´s annual production volume is 2.2 million tons of pellets, making it Europe’s largest pellet producer. The acquisition of the Texas Pellets pellet manufacturing plant offers a possibility to increase the group´s production capacity up to 25 percent.
We have been looking for a suitable opportunity to start pellet production in the United States for over 10 years. Once we have successfully completed this transaction, we will have firmly established our presence in North America, said Raul Kirjanen, CEO of Graanul Invest.