Pacific Ethanol, a producer and marketer of low-carbon renewable fuels in the U.S., acquired Illinois Corn Processing for $76 million, including $15 million in working capital. Wells Fargo has agreed to expand the company’s Kinergy line of credit from $85 million to $100 million to support the transaction.

ICP is a 90 million gallon per year fuel and industrial alcohol manufacturing, storage and distribution facility adjacent to the Pacific Ethanol Pekin facility and is located on the Illinois River. ICP produces fuel-grade ethanol, beverage and industrial-grade alcohol, dry distillers grain and corn oil. The facility has direct access to end-markets via barge, rail, and truck, and expands Pacific Ethanol’s domestic and international distribution channels.

Neil Koehler, Pacific Ethanol’s president and CEO, said, “The acquisition of ICP underscores our commitment to making strategic investments that expand and diversify our production platform, increase revenue, expand our marketing reach and improve our overall profitability. Two-thirds of ICP’s production is currently dedicated to producing high-quality, premium-priced alcohol products for the beverage and industrial markets. The consolidation of the ICP facility with our two Pekin, IL plants integrates the Pekin site into a unique combination of technologies and products with a combined operating capacity of 250 million gallons per year. We expect the acquisition will yield approximately $3 million.”

Pacific Ethanol will acquire Illinois Corn Processing from Illinois Processing Holdings, a wholly-owned subsidiary of SEACOR Holdings, and MGPI Processing, for $76 million, subject to a customary working capital adjustment. Of the $76 million purchase price, $30 million will be paid in cash and $46 million will be paid through the issuance of non-amortizing secured promissory notes due 18 months from closing.

Bryon McGregor, Pacific Ethanol’s CFO, said, “In conjunction with this transaction we are also taking steps to further strengthen our balance sheet and increase our available liquidity. We have a commitment from Wells Fargo Bank to expand our borrowing capacity on our Kinergy line of credit facility from $85 million to $100 million, reduce the cost of the facility and extend the maturity date for an additional two years.”