South Dakota ethanol plant investors to vote on merger
GROTON, S.D. (AP) — Investors of an ethanol plant in South Dakota will soon decide whether to merge with the plant’s parent company, POET Biorefining LLC.
The POET ethanol plant near Groton is among seven POET plants that haven’t had investors vote on merging operations, Aberdeen American News reported. But Groton plant investors plan to do so this month.
Jeff Lautt, president of POET Biorefining, said officials recently met with Groton plant investors in Aberdeen to discuss the potential merger. Investors at 19 other individual POET sites have already voted in favor of merging with the parent company, Lautt said.
Company officials have been working on the merger for several years.
“In the past, POET facilities have operated as individual business units,” Lautt said. “As such, they have not been able to leverage the benefits that come with operating as a combined entity.”
A merger would give the seven remaining POET facilities access to capital for growth and a way to diversify their portfolios and increase investor liquidity, he said.
Previous mergers have allowed POET to expand some of its plants and build a new one in Indiana, according to Lautt.
The Groton plant installed a new fermenter last year, but there could be hope for more expansion.
President Donald Trump last month instructed the Environmental Protection Agency to begin allowing year-round sales of E-15, which is a form of gasoline with a higher concentration of ethanol. Under environmental regulations, E-15 sales have been banned during summer months to limit air pollution when potential health risks are higher.
“With President (Donald) Trump’s recent announcement that E-15 will be available year-round, we expect more opportunities in the future for biofuels,” Lautt said. “POET Biorefining has access to far more capital than any individual plant. We are well-positioned to lead that new growth.”
Companies like POET hope the new rule will be in place by next summer.
Information from: Aberdeen American News, http://www.aberdeennews.com