ETHANOL BANKRUPTCY

Ethanol Producer Aventine Files for Chapter 11
April 8, 2009 (AP via Wall Street Journal)

"Ethanol producer Aventine Renewable Energy Holdings Inc. filed for Chapter 11 bankruptcy protection…the latest victim in an industry stung by volatile commodity prices and shrinking profit margins…Aventine listed assets of $799 million with $491 million in debt. The company listed 30 creditors.

"Chief Executive Ron Miller said Aventine is challenged by a difficult market environment, and the filing will allow it to operate without interruption…"

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"Aventine last month said it did not expect to have enough cash to satisfy a $15 million interest payment due April 1 on an outstanding senior unsecured 10% fixed-rate note or to pay $24.4 million due to its engineering and construction contractor, Kiewit Energy Co…In its most recent earnings statement, Aventine reported a fourth-quarter 2008 loss of $36.9 million, or 86 cents per share, compared with a profit of $3.3 million, or 8 cents per share, during the year-earlier period.

"The New York Stock Exchange suspended trading of Aventine shares on March 30, moving the stock to its 'pink sheets.'"

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"Sioux Falls-based VeraSun Energy Corp., the nation's No. 2 ethanol producer, filed for Chapter 11 bankruptcy protection Oct. 31 after tightening credit markets erased its lifeline to weather the swings in corn and fuel prices…Valero Energy Corp., the nation's largest independent oil refiner, bought five VeraSun plants and is in the process of closing on two more for a total $477 million…Another biorefiner, Pacific Ethanol Inc., warned…late last month that bankruptcy protection was a possibility and it may not be able to continue past April 30…

"The nation's renewable fuel standard ensures demand for ethanol by calling for 11.1 billion gallons of renewable fuel to be blended into gasoline this year, with that number climbing to 36 billion gallons by 2022."