Gevo targets USD 25m in share units offering

Dec 12, 2013 - US biofuels and biochemicals producer Gevo Inc (NASDAQ:GEVO) said Wednesday it expected to raise USD 25 million (EUR 18m) gross from a planned sale of common stock units.

The company will use the raised amount to ramp up start-up production and sales at the Luverne renewable isobutanol plant in Minnesota. It will also use a portion of the proceeds to pay back outstanding long-term debt and for working capital and general corporate needs.

Gevo is selling over 18.5 million common stock units at a price of USD 1.35 apiece. Each unit will include a common share and a warrant giving its holder the right to buy one more share at an exercise price of USD 1.85/share. The warrants expire on December 16, 2018. The company noted that some members of its management were interested in taking part in the public offering.

Piper Jaffray & Co is managing the sale, which also includes a 30-day over-allotment option of up to 2.8 million common shares and/or warrants.

The plant in Minnesota has a capacity of 18 million gallons (68 million litres) of isobutanol per year, according to Gevo’s website. Initially the facility was producing only ethanol, but the company retrofitted it to incorporate its proprietary yeast and integrated fermentation technology for the making of bio-based isobutanol.

Gevo noted that it had abandoned its plan to also sell senior note units.

(USD 1 = EUR 0.725)

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