SACRAMENTO, CALIFORNIA, US – Pacific Ethanol, Inc., a producer and marketer of low-carbon renewable fuels and alcohol products in the US, signed an agreement to sell its 74% ownership interest in Pacific Aurora, LLC to the Aurora Cooperative Elevator Company (Aurora Cooperative).
The sale is $52.8 million of consideration, subject to certain working capital adjustments. Aurora Cooperative currently holds a 26% ownership interest in Pacific Aurora, LLC.
Included in the sale are two ethanol production facilities with a combined annual production capacity of 145 million gallons, a grain elevator with storage capacity of 4.1 million bushels and integrated rail facilities located in Aurora, Nebraska, US.
“We are pleased to come to agreement with our valued partner Aurora Cooperative,” said Neil Koehler, president and chief executive officer (CEO) of Pacific Ethanol. “The sale of our interest is a win-win for both companies, strengthening Pacific Ethanol’s balance sheet while providing Aurora Cooperative with full ownership of these assets. We are confident that under Aurora Cooperative’s capable management and farmer ownership the facilities will provide value to the local community and the overall ethanol industry. We are committed to a smooth transition of operations and look forward to further collaboration with Aurora Cooperative in growing a successful ethanol business.”
After working capital adjustments and the settlement of certain payables between Pacific Aurora, LLC and the Aurora Cooperative, the consideration received at closing is expected to be approximately $27 million in cash and $16.5 million in promissory notes. The sale is anticipated to close within the next 45 days, subject to customary closing conditions.
“This investment is a great opportunity for Aurora Cooperative, its owners, and the communities that we support,” said Chris Vincent, president and CEO of Aurora Cooperative. “We understand the significance that these two ethanol plants, grain facilities and rail assets mean to our owners. Achieving full ownership of this local destination market is pivotal to our shared success. We look forward to these assets providing long term value for our owners, our Cooperative and our communities.”
Headquartered in Aurora, Nebraska, US, Aurora Cooperative has over 700 employees across 82 locations in seven states providing service in grain, agronomy, animal nutrition, and energy. In 2019, Aurora Cooperative had total sales of over $1 billion, serviced more than 4 million acres, merchandised over 120 million bushels of grain, and have over 34,000 equity members.