Down Under Moving Midwest
The sudden interest of private companies wanting to invest in ethanol plants is causing some consternation in the midwest. US ethanol plant development has been largely a grassroots campaign over the past decade financed by farmer-owned cooperatives. Now one of those co-ops is facing the entrepreneur’s dream dilemma – selling out for venture capital. Midwest Grain Processors, a 1,300 farmer co-op in Lakota, IA has a deal worth $100 million in the works with a little-known Australian corporation by the name of Global Ethanol. The big bucks would help the co-op double capacity, but it would cost them 60 percent interest.
The Des Moines Register reports today that Senator Charles Grassley (IA-R) is urging the farmers “not to sell control to a foreign company.” The farmer-owners must vote to approve the deal before it can go through.
When I started researching this story today, I spent about an hour searching for this Global Ethanol company on the web, unsuccessfully. I finally found an article in the Australian Courier-Mail that kind of answered my question, saying “Little is known about Global Ethanol. Director Timothy McMahon yesterday referred questions to fellow director Trevor Bourne, who is in the US.”
I think that’s a little weird that a company calling itself GLOBAL ETHANOL is nowhere to be found on the web and has little known about it. Not very global, if you ask me. I will be interested to see how this deal goes down.
1 Comment »
MGP shareholde
Greeings Ethanol Watchers
Curreently I am a shareholder in MGP and opposed to selling 60% of the company to Global Ethanol. Why? First Does it make sense to have one of best US Renewable fuel supplies being controled by a foreign company? Second the buy out price is to low (why do you think Global Ethanol is buying an onging plant instead of building their own plants) Third, while Global Ethanol production will ramp up. Current MGP members ethnaol production will shrink. Currently each share of MGP Stock would have 5.00 gallons of prodtion tied to each share when Riga plant comes on line in DEC of 2006. When the Global Ethnaol sales goes through each share will only have 2.00 gallons(5.00 * 40%= 2.00)uhas rougly. Nice growth plan for the current shareholders of MGP Stock. Why the MGP board wants to give up some of the best earnings in the ethanol business over the next 12-24 months the business has every seen is a question I would liked asked? Why the financial wizards of MGP board are planing to send all $100 million back to the current MGP shareholders, give up excellent future earnings and control company is amazing. For those invenstors who want “global growth in bio fuels” like our currnet MGP board “They can go buy ADM stock.” MGP should/needs to be lead by leaders/owners not by short sited puppets/sellers for MGP mangement (Coltivare). Time to send the current MGP board of directors on must deserved vaction.
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