Red Trail Energy equity holders approve acquisition by Gevo

Gevo Inc. announced Dec. 11 that its planned acquisition of the ethanol-production plant and carbon-capture and sequestration (CCS) assets of Red Trail Energy passed an important milestone as the equity holders of Red Trail Energy voted overwhelmingly to approve the transaction.

Gevo said this acquisition will accelerate its mission to transform renewable carbon and photosynthetic energy into net-zero liquid transportation fuels and chemicals while abating carbon.

“On behalf of the entire team at Gevo and our board of directors, stakeholders, shareholders, investors, customers and industry partners, we would like to thank the equity holders of Red Trail Energy for approving the acquisition,” said Gevo CEO Patrick Gruber. “With this investment, Gevo will be set on a path to becoming self-sustaining and profitable as a company in advance of our Net-Zero 1 project coming online. This acquisition also enables an ideal location for a Net-Zero North plant to produce sustainable aviation fuel (SAF). It also mitigates risk around carbon sequestration for our Net-Zero 1 plant site in South Dakota.”

Gevo is acquiring the Red Trail Energy ethanol production assets and the CCS assets, both based in Richardton, North Dakota, for $210 million in cash, subject to customary closing adjustments.

The transaction is expected to close by the first quarter of 2025, subject to receipt of regulatory approvals and the satisfaction of other customary closing conditions, including procurement of financing for the acquisition.

Gevo expects that these businesses, with the capability to create and deliver valuable biogenic-carbon credits in conjunction with the delivery of advanced liquid fuels, should deliver superior value to its shareholders.

“We believe these assets are ideal for furthering Gevo’s mission to create price-competitive domestic biobased production pathways for SAF using Gevo’s integrated alcohol-to-jet technology and defossilized energy, combined with CCS,” said Chris Ryan, the president and chief operating officer of Gevo. “The CCS well gives us optionality for our Net-Zero 1 carbon sequestration as well as regional synergies with Net-Zero 1, under development in Lake Preston, South Dakota, our development facility in Luverne, Minnesota, and our renewable natural gas (RNG) operations in Northwest Iowa. As Net-Zero 1 and other production facilities come online, the infrastructure and resources that we will have acquired in North Dakota offer tremendous flexibility for how we might operate in the area.”