Posted on 01/20/2012 4:56:57 PM PST by bigbob
Renewable Energy Group, the largest producer of biodiesel in the US, has raised $72 million in its initial public offering (IPO), only about two thirds of its target.
The 7.2 million shares were priced at $10.00 each, below the $13-15 bankers for the company, based in Ames, Iowa, initially proposed. It will start trading on the Nasdaq Global Market today.
Renewable Energy Group markets and distributes biodiesel throughout the US and operates six biodiesel plants, with a production capacity of 212 million gallons per year.
The company reported revenues of $208 million in 2010, compared with $109 million in 2009 and, in the first nine months of last year, it had a net income of $781,000.
However, in 2010, Renewable Energy Group made a $21.6 million net loss, and it has a loss-making history going back to 2008, which according to the filing stems from imposition of EU anti-dumping tariffs, the financial crisis, falling petroleum-based diesel fuel prices, an uncertain regulatory environment and high soybean oil prices.
“Given the poor performance of biofuel IPOs in 2011 …which are down 46% on average, the opening IPO of 2012 might face a chilly reception,” said Connecticut-based IPO research and investment group Renaissance Capital.
(Excerpt) Read more at environmental-finance.com ...
There is no sustainable feedsource for biodiesel, and at $11 per bushel, who's going to crush soybeans for fuel?
Despite governmental efforts to artificially create demand by enacting Renewable Fuels Standards, two-thirds of U.S. biodiesel production capacity now sits unused, reports the National Biodiesel Board.
This is what happens when the gummint tries to pick winners and losers.
And REG? As of today their stock is already down 5% in just 3 days of trading.
I once lived in Ames,Iowa. what a mistake.
Where did you get the ideal they used soybeans? ???? http://www.regfuel.com/
heh...well Iowa State is, after all, where John Atanasoff developed ENIAC, so I genuflect quickly when I blast past Ames on US-30!
“Given the poor performance of biofuel IPOs in 2011 …which are down 46% on average, the opening IPO of 2012 might face a chilly reception,”
When I was in the computer business, getting to be a "friend of the company" and getting shares at pre-IPO prices was almost a guarantee of making money.
Sometimes greed would get the best of me, and I'd hold too long, but because they were real businesses that were making money, and IPO was normally a sure thing.
I the biofuel "business" where the only way to make money is via gummint regs or subsidies you' have to be nuts to invest {or be using tax payer Monopoly Money}.
/s
“falling petroleum-based diesel fuel prices”
Huh?, gas/diesel prices are up 30% plus under Obongo
It is not the same as the oil based product.
Does anyone need a pile of clogged filters?
They need to get that problem worked out if they hope to be successful.
I was getting biodiesel and running my dozer and john deere tractor and was going through a filter every 2 days and at $18 a pop for the Cat dozer and $24 a pop for the tractor, it added up real fast. We filtered the diesel three times and something grows in it. We no longer will use it. My distributor will no longer buy it.
It is not the same as the oil based product.
Does anyone need a pile of clogged filters?
They need to get that problem worked out if they hope to be successful.
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