GEVO Stock In Spotlight After Red Trail Energy Shareholders Approve Assets Acquisition: Retail Sentiment Improves
By Stocktwits Inc | First Published Dec 11, 2024, 6:21 PM ISTGevo is acquiring Red Trail Energy’s ethanol production assets and the carbon capture and sequestration (CCS) assets, both based in Richardton, North Dakota, for $210 million in cash. The transaction is expected to close by the first quarter of 2025.
Shares of renewable energy and advanced biofuels firm Gevo Inc (GEVO) were in the spotlight on Wednesday morning after the company disclosed that Red Trail Energy shareholders have voted in favor of the company acquisition by Gevo.
Gevo is acquiring Red Trail Energy’s ethanol production assets and the carbon capture and sequestration (CCS) assets, both based in Richardton, North Dakota, for $210 million in cash. The transaction is expected to close by the first quarter of 2025.
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Gevo announced the acquisition of Red Trail Energy assets in September. The firm highlighted back then that the adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) from Red Trail's ethanol and CCS assets, when combined with the adjusted EBITDA from Gevo’s renewable natural gas business and other businesses, is expected to make the company’s adjusted operating profit positive in 2025.
Gevo CEO Patrick Gruber believes with this investment, the company will be set on a path to becoming self-sustaining and profitable as a company in advance of its Net-Zero 1 project coming online.
“This acquisition also enables an ideal location for a ‘Net-Zero North’ plant to produce sustainable aviation fuel. It also mitigates risk around carbon sequestration for our Net-Zero 1 plant site in South Dakota,” he said.
Gevo had earlier received a conditional commitment for a loan guarantee with disbursements totaling $1.46 billion from the U.S. Department of Energy Loan Programs Office for the Net-Zero 1 project.
Following the shareholder approval announcement, retail sentiment on Stocktwits inched higher into the ‘neutral’ territory (47/100) from ‘bearish’ a day ago.
Retail chatter on Stocktwits indicates a positive take on the stock.
Meanwhile, shares of Gevo were trading 0.68% lower in Wednesday’s pre-market session. The stock has gained over 25% since the beginning of the year.
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