GPRE, Great Lakes Cooperative complete merger

By Bryan Sims | April 08, 2008
Web exclusive posted April 14, 2008 at 12:35 p.m. CST

Omaha, Neb.-based ethanol producer Green Plains Renewable Energy Inc. has announced the completion of its merger agreement with grain storage company Great Lakes Cooperative. Initial voting was conducted by Great Lakes' voting members for approval in January. Great Lakes is now a wholly-owned subsidiary of Green Plains Renewable Energy.

"The integration of Great Lakes' business units with our ethanol production operation should increase efficiencies, reduce commodity price and supply risks and diversify our cash flows," said Green Plains Renewable Energy Chief Executive Officer Wayne Hoovestol.

Green Plains Renewable Energy has grain storage capacity of approximately 19 million bushels and provides complementary agronomy, seed, fertilizer, feed and petroleum services at various sites in the Corn Belt.

"By consolidating these strategic grain assets, we believe Green Plains will have a competitive advantage in corn procurement," Hoovestol added. "The merger supports our goal of great earnings per gallon of ethanol produced and added shareholder value."

Under terms of the agreement, Great Lakes' members received approximately $12.5 million in cash and 550,352 shares of Green Plains Renewable Energy's common stock. To finance the merger and ongoing operational requirements, Green Plains Renewable Energy entered into term and revolving loan agreements with a group of lenders and financial institutions.

Currently, Green Plains Renewable Energy owns and operates a 50 MMgy ethanol plant in Shenandoah, Iowa, which began production last year. Green Plains Renewable Energy's second facility, a 50 MMgy plant in Superior, Iowa, is under construction and is expected to begin production later this spring, the company noted.