Flint Hills to acquire final Hawkeye plants
Hawkeye Renewables LLC has agreed to sell its ethanol plants in Iowa Falls and Fairbank, Iowa, to Flint Hills Resources Renewables LLC, an affiliate of Koch Industries Inc. and petroleum refiner Flint Hills Resources LLC. Flint Hills will pay an undisclosed all-cash sum for the two facilities. The sale is expected to close during the first quarter of 2011.
Hawkeye Renewables filed for Chapter 11 bankruptcy in December 2009 and emerged from its voluntary restructuring last June with new equity ownership for the 100 MMgy Iowa Falls plant and the 115 MMgy Fairbank plant. Hawkeye Energy Holdings was able to continue managing the facilities and its subsidiary, Hawkeye Gold LLC, continued to serve as the ethanol and distillers grains marketer for the two plants. “Over the past six months we have made significant progress in improving Hawkeye Renewables’ operations,” James Continenza, chairman of the board of directors for Hawkeye Renewables, said. “Our agreement with Flint Hills builds on this solid foundation and represents a successful conclusion to the strategic review that our Board began to maximize equity holder value. It is my belief that Flint Hills Resources Renewables will be a committed operator in the Iowa community and will work diligently to develop and maintain relationships with Hawkeye Renewables’ existing vendors, suppliers and farmers.”
Last fall, Flint Hills made its entrance into the ethanol industry with the purchase of two other Hawkeye ethanol plants. The 115 MMgy plants in Menlo and Shell Rock, Iowa, were owned by Hawkeye Growth LLC and were purchased by Flint Hills for undisclosed sum. “We’re very pleased to add the Fairbank and Iowa Falls plants to our growing renewables business,” Flint Hills Resources President Brad Razook said. “The acquisition enhances our existing renewables business and contributes to our market leadership in producing transportation fuels.”
Flint Hills Resources owns and operates petroleum refineries in Minnesota, Alaska, Illinois, Michigan and Texas. The company is the largest purchaser of ethanol in Minnesota and produces 320,000 barrels of transportation fuels per day at its St. Paul refinery. The company also operates a fuel terminal in Iowa and distributes refined fuels throughout the state.