Business Context and Reporting Period
Company: Green Plains Renewable Energy, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: November 22, 2013
Event: Completion of the acquisition of two ethanol plants located in Wood River, NE, and Fairmont, MN, from Ethanol Holding Company, LLC.
Key Financial Metrics and Transaction Details
- Acquisition Price: $108 million in cash (includes an initial working capital amount).
- Additional Consideration: An additional amount based on actual working capital to be determined and paid shortly after closing.
- Production Capacity: The acquired facilities have a combined annual capacity of approximately 220 million gallons.
- Total Company Capacity: Post-acquisition, Green Plains' production capacity exceeds one billion gallons of ethanol per year.
- Financing Plan: Green Plains plans to execute approximately $77 million in term debt agreements, using the acquired assets as collateral.
Material Changes
The primary material change is the expansion of Green Plains' asset base and production capacity. The transaction was finalized on November 22, 2013, following a deed in lieu of foreclosure where the plants were transferred to the seller (Ethanol Holding Company, LLC) and simultaneously purchased by Green Plains. An amendment to the original agreement executed on this date clarified the treatment of spare parts inventory.
Outlook, Risks, and Contingencies
- Financial Statements: Financial statements of the acquired businesses and pro forma financial information are not included in this filing. They are scheduled to be filed by February 10, 2014.
- Debt Obligations: The company intends to secure $77 million in term debt secured by the new assets.
- Working Capital Adjustment: The final purchase price is contingent upon the determination of actual working capital at closing.
Investor Verification Checklist
- Verify the final working capital adjustment amount once determined.
- Review the financial statements of the acquired businesses when filed by February 10, 2014.
- Confirm the execution and terms of the planned $77 million term debt agreements.
- Assess the integration timeline and operational status of the Wood River and Fairmont facilities.