Singapore-based commodity trader Noble Group (SGX:CGP) on Friday announced a deal to sell its ethanol plant in South Bend, Indiana to Mercuria Investments US Inc, a subsidiary of Mercuria Energy Group Ltd.
Noble has found a new buyer for its unit that owns and operates the plant, Noble Americas South Bend Ethanol LLC (NASBE), after at the end of November it unveiled an agreement to sell the business to family-owned Zeeland Farm Services Inc. That previous deal included a go-shop period ending on December 11.
The new agreement calls for an increase in the base consideration by USD 3 million (EUR 2.5m) to USD 15.5 million, so including net working capital and inventory value the price tag would be about USD 20 million. Noble, however, will pay a termination fee of USD 2 million to Zeeland.
Based on NASBE's carrying value at the end of September, Noble estimates a loss on the proposed disposal of USD 60.3 million.
The divestment is in connection with the sale of Noble's global oil liquids business to Vitol US Holding Co. The latter has agreed that Noble can sell NASBE prior to the closure of the oil transaction.
(USD 1 = EUR 0.849)
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