EQM to sell biodiesel production business to Delek Renewables
EQM Technologies & Energy Inc., a provider of environmental services to government and commercial businesses, announced that it has entered into an agreement to sell its biodiesel production facility based in Cleburne, Texas, and related assets to Delek Renewables LLC, a wholly owned subsidiary of Delek US Holdings Inc., for approximately $5.3 million in cash. The transaction, which has been approved by EQM's Board of Directors, is expected to close on or before Jan. 23, and is subject to customary closing conditions. EQM plans to use the proceeds from the transaction to pay off all $1.65 million unpaid principal and all accrued but unpaid interest under EQM's secured subordinated notes that are secured by the assets being sold in the transaction, and for general corporate purposes.
EQM and Delek Renewables are parties to a tolling agreement pursuant to which EQM produces biodiesel for Delek Renewables using the feedstock of Delek Renewables. This tolling agreement will terminate upon the completion of the asset sale.
“The transaction will allow us to exit the biodiesel production business while achieving value for our stockholders,” said James E. Wendle, president and chief operating officer of EQM. “Following the transaction, our team will be able to focus entirely on the growth of our environmental services business. With an improved operating platform and capital structure, EQM is poised to accelerate its growth plan, which includes organic growth, as well as strategic acquisitions of environmental service companies with proven track records of growth and increasing profit margins.”