Pacific Ethanol Inc., a producer and marketer of renewable fuels in the western U.S., and Aventine Renewable Energy Holdings, a Midwest-based producer of ethanol and related co-products, have entered into a definitive agreement under which Pacific Ethanol will acquire all of Aventine's outstanding shares in a stock-for-stock merger transaction.
Aventine – whose ethanol production assets include both a wet and dry mill in Pekin, Ill., and two dry mills in Aurora, Neb. – will be operated as Pacific Ethanol's wholly owned subsidiary.
Pacific Ethanol says its current ethanol production capacity is 200 million gallons per year, and the combined company will now have a total production capacity of 515 million gallons per year.
‘This transaction will more than double our annual ethanol production capacity, and it will establish Pacific Ethanol as the fifth-largest producer and marketer of ethanol in the United States,” claims Neil Koehler, CEO of Pacific Ethanol.
The transaction is subject to customary and other closing conditions and regulatory approvals, as well as the approval of both companies' shareholders. The deal is expected to be finalized in the second quarter of 2015.