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Troutman Sanders Advises Pacific Ethanol in Refinancing, Business Expansion

01.04.17

ORANGE COUNTY, Calif. Jan. 4, 2017 – Troutman Sanders announced today that it recently advised Sacramento, Calif.-based Pacific Ethanol, Inc., a leading producer and marketer of low-carbon renewable fuels in the United States, in a series of transactions in connection with the refinancing of Pacific Ethanol’s $155 million principal term debt.

In connection with the transactions:

  • Pacific Ethanol created a new subsidiary company, Pacific Aurora LLC (PAL), and contributed $186 million in ethanol plant assets (consisting of two ethanol plants located in Nebraska) to PAL.

  • Aurora Cooperative Elevator Company contributed $25 million in grain facility assets to PAL.

  • Pacific Ethanol sold of a portion of its equity interest in PAL to Aurora Cooperative Elevator Company for $30 million.

  • Pacific Ethanol’s subsidiary, Pacific Ethanol Pekin Inc., obtained a new $64 million term loan and a new $32 million line of credit.

  • Pacific Ethanol issued $55 million in senior secured debt to several accredited investors.

  • PAL obtained a new $30 million credit facility to fund future working capital requirements.

  • Pacific Ethanol’s marketing subsidiary, Kinergy Marketing, LLC, obtained an increase its line of credit to $85 million.

Through these transactions, it is expected that Pacific Ethanol will reduce its interest costs by more than $8 million annually, reduce total debt outstanding by more than $12 million and increase its cash, working capital and liquidity resources by $55 million.

The Troutman Sanders team assisting Pacific Ethanol was led by partner Larry Cerutti and also included partners John Bradley, Marty Taylor, Brad Wolf, and Adam Kobos and associates Rushika de Silva and Kirk Dungca.

More information about the deal can be found here.

About Troutman Sanders
Troutman Sanders LLP is an international law firm with more than 650 lawyers in 16 offices located throughout North America and Asia. Founded in 1897, the firm’s lawyers provide counsel and advice in practically every aspect of civil and commercial law related to the firm’s core practice areas: Corporate, Energy and Industry Regulation, Finance, Litigation and Real Estate. Firm clients range from multinational corporations to individual entrepreneurs, federal and state agencies to foreign governments, and non-profit organizations to businesses representing virtually every sector and industry. See troutmansanders.com for more information.

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