Ethanol producer VeraSun Energy has closed its merger with US BioEnergy after the transaction was approved by a majority vote of shareholders of both companies. The merger will be effective as of April 1, 2008.
Under the merger agreement, each outstanding share of US BioEnergy common stock will be converted into 0.810 shares of VeraSun common stock, representing a premium of approximately 11%.
The existing VeraSun shares will remain outstanding and will represent approximately 59% of the shares outstanding after the merger. VeraSun common stock will continue to trade on the New York Stock Exchange.
With the completion of the merger, VeraSun owns and operates 10 ethanol production facilities with an annual capacity of 980 million gallons per year. Seven other facilities are currently under construction or development.
By the end of 2008, the company expects to have 16 production facilities in operation with a capacity of approximately 1.64 billion gallons, reportedly making VeraSun the largest ethanol producer in the US.
Don Endres, VeraSun CEO, said: The size and scale that results from this merger will allow us to become more relevant to our customers in the petroleum industry and continue to position VeraSun as a premier platform company in the renewable fuels industry.