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Renewal energy group NTR will not participate in an $80 million
(€59m) share offering by Green Plains Renewable Energy (GPRE),
which will result in NTR’s stake falling from 45 per cent
to around under 40 per cent, it is understood.
Ethanol producer GPRE, which is quoted on the Nasdaq, announced
recently that it plans to place 5 million shares. The ethanol
sector in the US is hugely fragmented and it is expected that
the company will use at least some of the money to make acquisitions.
GPRE’s share price has grown rapidly over the past year -
from a low, at one stage of $1.12, to over $16.40 recently.
A share price of about $12 covers NTR’s investment in the
company to-date, which means that NTR has a paper profit on
its GPRE investment of over $50 million.
Participating in the fundraising, which aims to raise between
$70 million and $80 million, would have cost NTR - which is
headed by Jim Barry - in excess of $30 million, depending
on the share price. However, NTR is happy to see the stock’s
liquidity improve as demand for the stock from institutional
investors grows.
GPRE released fourth quarter results recently, with net income
increasing to $23.1 million compared to a loss of $1.8 million
in 2008. Revenues for Q4 were $436.7 million, compared to
$183.2 million in 2008, with GPRE producing 122 million gallons
of ethanol, which exceeded the group’s expected capacity.
Source - The Sunday Business Post
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