May 21, 2014
BY Renewable Energy Group Inc.
Renewable Energy Group Inc. has reached an agreement with Tyson Foods Inc. to acquire Tyson’s 50-percent ownership position in Dynamic Fuels LLC, the companies announced today.
Completion of the transaction with Tyson Foods, which is contingent upon the closing of REG’s December 2013 announced agreement to acquire substantially all of the assets of Syntroleum Corp., would give REG full ownership of Dynamic Fuels and its 75 MMgy nameplate capacity renewable diesel biorefinery in Geismar, La. Tyson and Syntroleum formed Dynamic Fuels in 2007 as a 50/50 joint venture. The Geismar facility, completed in 2010, was the first large scale renewable diesel biorefinery built in the U.S.
“Upon closing, this is another milestone for REG in growing our core advanced biofuels business,” said Daniel J. Oh, REG president & CEO. “It gives us the opportunity to further expand our production capacity into new product lines, while growing our overall advanced biofuel manufacturing capability, and bringing on other renewable chemical applications.”
Advertisement
Advertisement
“Selling our interest in Dynamic Fuels to REG provides capital for Tyson to redeploy into other opportunities,” said Andrew Rojeski, vice president-renewable energy for Tyson Foods. “REG is a long-term customer of ours, buying fats, oils and greases to make renewable fuel, and we hope to continue that relationship.”
Under the terms of the agreement, an REG subsidiary would acquire Tyson Foods’ 50-percent membership interest in Dynamic Fuels by paying Tyson approximately $18 million in cash at closing and up to $35 million in future payments tied to production volume at the Geismar biorefinery over a period of up to 11.5 years. REG will also fund repayment of approximately $12 million of Dynamic Fuels’ indebtedness to Tyson at closing.
Advertisement
Advertisement
A portion of the development and construction of the Geismar biorefinery was funded by $100 million in Gulf Opportunity Zone Bonds, issued through the Louisiana Public Facilities Authority. Closing of the acquisition from Tyson Foods is conditioned on REG’s replacement of the letter of credit Tyson Foods obtained to support issuance of the bonds or completion of a financing sufficient to refinance the bonds prior to Dec. 31, 2014, on terms acceptable to REG. REG may seek to use existing cash on hand and/or one or more financing vehicles, including public or private debt or equity, to satisfy this condition. Closing is also subject to satisfaction of other customary closing conditions.
REG currently owns eight operating biodiesel refineries in Iowa, Illinois, Minnesota and Texas that have a combined annual nameplate production capacity of 257 million gallons. With the addition of the Geismar facility, the company’s total advanced biofuel annual nameplate production capacity would increase to 332 million gallons.
BIO, in partnership with Kearney, a global management consulting firm, on March 24 released a report showing the U.S. bioeconomy currently contributes $210 billion in direct economic impact to the U.S. economy, excluding healthcare.
Airbus is taking a significant step toward scaling the adoption of sustainable aviation fuel (SAF) by testing a new “Book and Claim” approach. This initiative aims to boost both supply and demand for SAF worldwide.
Signature Aviation, the world’s largest network of private aviation terminals, has announced the expansion of its blended SAF offering at six new locations across Europe following multiple blended SAF supply agreements.
China’s exports of used cooking oil (UCO) reached a record high in 2024 but fell sharply in December after the Chinese government eliminated the 13% export tax rebate for UCO, according to a report filed with the USDA.
Ash Creek Renewables, a portfolio company of Tailwater Capital LLC, on March 20 announced it has secured exclusive licensing rights from Montana State University for a new high-performance camelina seed variety.