Renewable Energy Group (REG) executed a purchase agreement
to acquire a 30-million gal/year biodiesel plant from Soy
Energy, the companies announced on Friday.
Pursuant to the agreement, REG will acquire the biorefinery in Mason City, Iowa,
for $11 million in cash and the issuance of a $5.6 million
promissory note to Soy Energy.
The acquisition is subject to customary closing conditions,
including approval of the transaction by the Soy Energy unit
The Mason City plant, originally built to process highly
refined raw materials in 2006, was purchased by Soy Energy in
2010 and upgraded to utilize a larger variety of raw materials
including animal fats and used cooking oil. The plant was idled
in mid-2012 due to market conditions and manufacturing
Renewable Energy Groups offer provides the best
value for Soy Energy unit holders while helping unit holders
achieve their mission for promoting economic development in the
area, said Jeff Oestmann, Soy Energys CEO. In
addition, REGs procurement know-how and proven business
model of using lower cost raw materials makes them a reliable
operator for this plant.
REG plans to repair then restart the refinery and further upgrade the
plant in the future. The acquisition would increase REGs
biodiesel production capacity to 257 million gal/year. REG
currently owns seven active biodiesel refineries in five
states, including nearby plants in Newton and Ralston, Iowa and
Albert Lea, Minnesota.
We are committed to the people of Mason City,
Midwestern farmers and livestock producers and those who supply
the fats, oils and greases we will buy, said Daniel J.
Oh, REG chief executive.
REG expects approximately 30 full-time, family-wage jobs to be
filled at the plant.
The Soy Energy plant is strategically positioned
within the REG network of plants to meet regional and national
demand for lower carbon, clean-burning
biodiesel, Oh said.