VeraSun Energy Delays Startup of Janesville, Minnesota, Ethanol Biorefinery
November 04 2008 - 2:25PM
PR Newswire (US)
SIOUX FALLS, S.D., Nov. 4 /PRNewswire-FirstCall/ -- VeraSun Energy
Corp., one of the nation's largest ethanol producers, today
announced that it is indefinitely delaying the startup of its 110
million gallon per year (MMGY) ethanol biorefinery in Janesville,
Minn. VeraSun will continue operations at its 14 facilities across
an eight-state region. VeraSun filed voluntary petitions for relief
under chapter 11 of the U.S. Bankruptcy Code in the United States
Bankruptcy Court on Friday, Oct. 31 to enhance liquidity while it
reorganizes. However, at this time, the secured lender of the plant
has not provided the necessary financing to continue construction
and startup activities. Efforts to secure financing for Janesville
are underway. Construction on the Janesville facility is nearly
completed and the plant was scheduled to begin operations prior to
the end of the year. Construction began in January 2007 and
ownership of the plant moved under VeraSun on April 1, 2008,
following its merger with US BioEnergy. Most of the 53 employees
will be furloughed immediately. About VeraSun Energy Corporation
VeraSun Energy Corp., headquartered in Sioux Falls, S.D., is a
producer and marketer of ethanol and distillers grains. Founded in
2001, the company has a fleet of 16 production facilities in eight
states, with 14 currently in operation. VeraSun currently has an
annual production capacity of 1.42 billion gallons of ethanol and
more than 4.5 million tons of distillers grains. VeraSun also
markets E85, a blend of 85 percent ethanol and 15 percent gasoline
for use in Flexible Fuel Vehicles (FFVs), directly to fuel
retailers under the brand VE85(R). For more information, please
visit VeraSun Energy's websites at http://www.verasun.com/ or
http://www.ve85.com/. Forward-Looking Statements This press release
contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. In particular,
statements by VeraSun and its subsidiaries (the "Company")
regarding future events and developments and the Company's future
performance, including statements regarding proceedings relating to
the Company's petitions for relief under Chapter 11 of Title 11 of
the United States Code and the Company's operations and funding
during the chapter 11 process, as well as other statements of
management's expectations, anticipations, beliefs, plans,
intentions, targets, estimates, or projections and similar
expressions relating to the future, are forward-looking statements
within the meaning of these laws. Forward-looking statements in
some cases can be identified by their being preceded by, followed
by or containing words such as "estimate," "plan," "project,"
"forecast," "intend," "expect," "anticipate," "believe," "seek,"
"target" and other similar expressions. Forward-looking statements
are based on assumptions and assessments made by the Company's
management in light of their experience and their perception of
historical trends, current conditions, expected future developments
and other factors they believe to be appropriate. Any forward-
looking statements are not guarantees of the Company's future
performance and are subject to risks and uncertainties that could
cause actual results, developments and business decisions to differ
materially from those contemplated by any forward-looking
statements. Except as required by law, the Company undertakes no
obligation to update any forward-looking statements. Some of the
factors that may cause actual results, developments and business
decisions to differ materially from those contemplated by any
forward-looking statements include the following: the ability of
the Company to continue as a going concern; the ability of the
Company to obtain additional debtor-in-possession financing on an
interim or final basis and to operate pursuant to the terms of any
debtor-in-possession financing; the Company's ability to obtain
court approval with respect to motions in the chapter 11 proceeding
prosecuted by it from time to time, including approval of motions
relating to the priority of the lender's security interest under
any debtor-in-possession financing; the ability of the Company to
develop, prosecute, confirm and consummate one or more plans of
reorganization with respect to the chapter 11 cases; risks
associated with third parties seeking and obtaining court approval
to terminate or shorten the exclusivity period for the Company to
propose and confirm one or more plans of reorganization, for the
appointment of a chapter 11 trustee or to convert the cases to
chapter 7 cases; the ability of the Company to obtain and maintain
normal terms with vendors and service providers; the Company's
ability to maintain contracts that are critical to its operations;
the potential adverse impact of the chapter 11 cases on the
Company's liquidity or results of operations; the ability of the
Company to fund and execute its business plan; the ability of the
Company to attract, motivate and/or retain key executives and
employees; the ability of the Company to attract and retain
customers; the volatility and uncertainty of corn, natural gas,
ethanol, unleaded gasoline and other commodities prices; the
Company's ability to generate sufficient liquidity to fund its
operations and capital expenditures; the results of the Company's
hedging transactions and other risk mitigation strategies; risk of
potential goodwill and other intangible impairment; operational
disruptions at the Company's facilities; the effects of vigorous
competition and excess capacity in the industries in which the
Company operates; the costs and business risks associated with
developing new products and entering new markets; the development
of infrastructure related to the sale and distribution of ethanol;
the effects of other mergers and consolidations in the biofuels
industry and unexpected announcements or developments from others
in the biofuels industry; the uncertainties related to the
Company's acquisitions of US BioEnergy Corporation, ASA OpCo
Holdings, LLC and other businesses, including the Company's ability
to achieve the expected benefits from these acquisitions; the
impact of any new, emerging and competing technologies on the
Company's business; the possibility of one or more of the markets
in which the Company competes being impacted by political, legal
and regulatory changes or other external factors over which the
Company has no control; changes in or elimination of governmental
laws, credits, tariffs, trade or other controls or enforcement
practices; the impact of any potential Renewable Fuel Standards
waiver; the Company's ability to comply with various environmental,
health, and safety laws and regulations; the success of the
Company's marketing and sales efforts; the Company's reliance on
key management personnel; the Company's ability to secure
additional financing; the volatility of the market price of
VeraSun's stock; the Company's ability to implement additional
financial and management controls, reporting systems and procedures
and continue to comply with Section 404 of the Sarbanes-Oxley Act,
as amended; and the risk factors described in VeraSun's filings
with the Securities and Exchange Commission, including the
prospectus supplement filed on September 16, 2008. Similarly, these
and other factors, including the terms of any reorganization plan
ultimately confirmed, can affect the value of the Company's various
pre-petition liabilities and VeraSun's common stock. No assurance
can be given as to what values, if any, will be ascribed in the
chapter 11 proceeding to each of these constituencies. Accordingly,
the Company urges that the appropriate caution be exercised with
respect to existing and future investments in any of these
liabilities and/or securities. DATASOURCE: VeraSun Energy Corp.
CONTACT: Media, Mike Lockrem, +1-605-978-7055, , or Investors,
Patty Dickerson, +1-605-978-7137, , both of VeraSun Web site:
http://www.verasun.com/
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