REG closes buy of initial 50% in Louisiana biorefinery
Jun 4, 2014 - US biodiesel producer Renewable Energy Group Inc (NASDAQ:REGI), or REG, said yesterday it had concluded its acquisition of an initial 50% stake in the Geismar renewable diesel biorefinery in the state of Louisiana.
The targeted facility has an annual nameplate capacity of 75 million gallons (283.9 million litres) of biodiesel.
More specifically, REG has completed its previously announced takeover of Oklahoma-based renewable diesel fuel technologies firm Syntroleum Corp (NASDAQ:SYNM), which in turn owns half of Dynamic Fuels LLC, the holding company for the Geismar plant. As part of the deal, signed in December, REG has issued nearly 3.5 million common shares to Syntroleum.
The company also has an existing agreement with meat processor Tyson Foods Inc (NYSE:TSN) to buy the latter’s own 50% in Dynamic Fuels in exchange for about USD 18 million (EUR 13.2m) in cash at completion plus up to USD 35 million in future milestone payments. In addition, the buyer will repay some USD 12 million of debt at closing.
At present, REG owns nine operating biodiesel refineries in five states.