Edeniq, Aemetis file suits in dispute over merger cancellation
Plans for an Aemetis-Edeniq merger have gone sour, with suits and countersuits being filed. Aemetis Inc. announced May 6 that it would acquire Edeniq Inc.’s outstanding share in a stock-plus-cash merger transaction. In August, Edeniq withdrew from the merger, which was followed not long after by Aemetis taking them to court.
Edeniq announced March 24 that it was filing a cross-complaint against Aemetis for “fraud and negligent misrepresentation, among other claims,” the company said in its news release. “Edeniq lawfully terminated its merger agreement with Aemetis, Inc. in August 2016 and is vigorously defending itself against a meritless lawsuit Aemetis filed shortly thereafter.”
The company said it has succeeded in having two of Aemetis’ four orginial claims dismissed. The cross-complaint and answer were filed March 20 in Santa Clara (California) Superior Court. The company’s statement explained: “Edeniq’s cross-complaint alleges that Aemetis was unable to finance the merger and fraudulently induced Edeniq to enter into the agreement by misrepresenting the circumstances under which it could do so. Edeniq also seeks to enjoin Aemetis from misappropriating Edeniq’s trademark, which Aemetis continues to display on its company’s homepage, and which Edeniq alleges gives the false impression that the parties are presently affiliated. Damages are also at issue—Edeniq’s cross-complaint seeks monetary relief to remedy harm it alleges was caused by Aemetis’ interference with Edeniq’s preexisting contracts, as well as its interference with Edeniq’s potential business with future customers.”
California-based Edeniq, a developer of cellulosic ethanol technology, raised $7 million in equity capital from existing investors in December. Three ethanol plants have received cellulosic ethanol registrations using Edeniq’s Pathway technology, which includes a method for determining cellulosic ethanol production from an in situ process.
California-based Aemetis operates a 60 MMgy ethanol plant in Keyes, California. In recent months, it has announced the addition of carbon dioxide capture facility and plans for cellulosic ethanol production using Lanzatech technology. The company also owns a biodiesel facility India and has plans to use byproducts from the Lanzatech process in renewable jet fuel or diesel production. In the past year, Aemetis is raising capital through the EB-5, a federal program that encourages job creation via foreign investments from qualified investors who become eligible for green cards.