Lignol increases stake in major Australian biodiesel producer
March 20, 2013
BY Lignol Energy Corp.
Lignol Energy Corp. announced March 18 that it has invested approximately $2.6 million to acquire approximately 356 million shares of Australian Renewable Fuels Ltd. as a part of ARW’s underwritten rights issue of approximately $8.31 million. ARW is the largest biodiesel producer in Australia owning three plants with a total nameplate capacity of 150 million liters (39.6 million gallons) per annum. ARW’s three plants were built at an aggregate cost of more than $103.9 million. This investment was funded, in part, from LEC’s recently announced line of credit with one of the company’s major shareholders, Difference Capital Funding Inc. This investment together with the approximately 179 million shares acquired by LEC as a part of ARW’s share placement, announced on Feb. 12, and shares previously acquired by LEC has resulted in a total ownership of approximately 898 million shares, representing 21.4 percent of ARW.
“We are pleased to have participated in the private placement, the shareholder entitlement offer, and to have supported ARW through the related underwriting to become one of ARW’s largest shareholders,” said Ross MacLachlan, chairman and CEO. “As a result of our recent investments, LEC is now well positioned in the Australian biodiesel industry. These investments are further evidence of our strategy of acquiring interests in companies which have synergy with our company and have the potential to generate near term cash flow.”
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LEC also owns a stake in Territory Biofuels Ltd., owner of a large-scale biorefining facility located in Darwin, Northern Territory, Australia, which includes a Lurgi-designed biodiesel plant and the only glycerin refinery in Australia. The facility was commissioned in 2008 at a cost of $83.1 million, along with 38 million liters (10 million gallons) of related tankage, now leased by TBF. The biodiesel plant is the largest in Australia with a maximum capacity of 150 million liters (39.6 million gallons) per year. The plant was shut down in 2009 and TBF is currently in the process of planning the restart of the facility.
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