Web exclusive posted Dec. 23, 2008, at 1:21 p.m. CST

HydroGenetics Inc., an emerging green energy holding company, announced Dec. 19 the execution of a binding letter of intent to acquire Tonawanda, N.Y.-based Buffalo Biodiesel Inc. Under the terms of the agreement, Buffalo Biodiesel will become a wholly owned subsidiary of HydroGenetics. The transaction is expected to be complete by the end of the year.

Buffalo Biodiesel collects and renders yellow grease from areas in New York and Pennsylvania, processing the feedstock into biodiesel. According to HydroGenetics Chief Executive Officer Marc Walther, the facility's production capacity is 5 MMgy.

Walther said future plans for the facility include expanding grease collection activities into additional states, and expanding the production of both yellow grease and biodiesel. "We're developing the business plan in detail right now," he said.

The acquisition is HydroGenetics' first regarding biodiesel, Walther said, noting the company is involved with other alternative energy projects, including hydrogen. "This agreement signals yet another segment of the green energy world HydroGenetics Inc. will contend in," he said. "Our emerging technologies, combined with the revenues generated by our new subsidiary, provide us with the necessary cash flow to grow our biodiesel business in the short-term while we are executing our long-term financing strategy, and the development and commercialization of green technologies in our pipeline."