Rentech Closes the Sale of Alternative Energy Technology Assets
November 04 2014 - 6:00AM
Business Wire
Rentech, Inc. (NASDAQ:RTK) announced today that it has closed
the previously announced sale of its alternative energy
technologies to Sunshine Kaidi New Energy Group Co., Ltd. (Kaidi).
Rentech received a cash payment of $14.4 million from Kaidi, which
is in addition to $0.5 million in cash payments previously
received. Kaidi will pay an additional $0.4 million to Rentech to
purchase various equipment currently located at Rentech’s
decommissioned Product Demonstration Unit (PDU), resulting in $15.3
million of total proceeds to Rentech from these transactions. This
additional transaction is expected to close before the end of the
year.
D. Hunt Ramsbottom, president and CEO of Rentech, stated, “We
are pleased to have closed this sale as part of our cost reduction
efforts and focus on our wood fibre processing and nitrogen
fertilizer businesses. By monetizing these non-core assets, we have
improved our balance sheet and will be realizing significant
SG&A savings going forward.”
The transaction calls for the possibility of success payments to
Rentech of up to $16.2 million. These payments would be triggered
if Kaidi successfully builds and operates, at its cost, a
demonstration-scale plant in China that uses the technologies
acquired from Rentech and performs at specified levels.
Rentech and Kaidi will share equally in any proceeds from the
future sale of the PDU site in Commerce City, CO, net of
transaction fees and carrying costs of the property incurred
by Rentech after September 30, 2014. Rentech expects to
close on the sale of the site in the first half of 2015.
The sale of the technologies should increase Rentech’s net
operating loss carryforwards applicable to federally taxable income
by approximately $12.5 million.
About Rentech, Inc.
Rentech, Inc. (NASDAQ: RTK) owns and operates wood fibre
processing, wood pellet production and nitrogen fertilizer
manufacturing businesses. Rentech offers a full range of integrated
wood fibre services for commercial and industrial customers around
the world, including wood chipping services, operations, marketing,
trading and vessel loading, through its subsidiary, Fulghum Fibres.
The Company’s New England Wood Pellet subsidiary is a leading
producer of bagged pellets for the U.S. heating market. Rentech
manufactures and sells nitrogen fertilizer through its
publicly-traded subsidiary, Rentech Nitrogen Partners, L.P. (NYSE:
RNF). Please visit www.rentechinc.com and www.rentechnitrogen.com
for more information.
Safe Harbor Statement
This press release contains forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995
about matters such as the expected closing date of the sale of the
PDU site, future SG&A savings and the potential for success
payments. These statements are based on management’s current
expectations and actual results may differ materially as a result
of various risks and uncertainties. Other factors that could cause
actual results to differ from those reflected in the
forward-looking statements are set forth in the Company’s prior
press releases and periodic public filings with the Securities and
Exchange Commission, which are available via Rentech’s website at
www.rentechinc.com. The
forward-looking statements in this press release are made as of the
date of this press release and Rentech does not undertake to revise
or update these forward-looking statements, except to the extent
that it is required to do so under applicable law.
Rentech, Inc.Julie Dawoodjee CafarellaVice President of
Investor Relations and Communications310-571-9800ir@rentk.com
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