Jan 4 2018
The company noted that the purpose of the bankruptcy filing is to seek to sell the assets of the Company’s Fulghum Fibres and New England Wood Pellet subsidiaries as well as facilitate an orderly wind-down of Rentech Inc.
Rentech said that its subsidiaries conducting its Fulghum Fibres business in the U.S., which have not filed for bankruptcy protection, entered into an Asset Purchase Agreement won December 15, 2017 with an affiliate of Scott Davis Chip Company, Inc. for the sale of substantially all of the assets of that business. The closing of this transaction is subject to approval of the Bankruptcy Court.
Also on December 15, 2017, Rentech’s subsidiary that owns the Canadian Atikokan pellet production facility entered into an Asset Purchase Agreement with 2607043 Ontario Inc., an affiliate of True North Timber, a forest resources company, for the going-concern purchase of substantially all of the assets of the Atikokan operations. The facility supplies wood pellets to Ontario Power Generation’s 100 per cent biomass-fuelled generating station in Atikokan. Earlier this year the 100,000 tonnes-capacity facility reduced the capacity to 45,000 tonnes per year to meet the OPG contract.
Rentech’s other Ontario based pellets production plant Wawa, remains idle, and the company has has applied to the Ontario Superior Court of Justice for the appointment of a receiver and manager to facilitate the sale or liquidation of that facility.
On a consolidated basis as of November 30, 2017, Rentech has approximately $65.3 million of secured debt. Based on the sales prices currently anticipated for the Fulghum Fibres U.S. and New England Wood Pellet businesses and the Atikokan Facility, the company does not presently expect that any proceeds from these transactions will be available for distribution to Rentech’s stockholders.
According to information presented by Biomass Magazine has the bankruptcy filing lists Lignetics of New England Inc. as the buyer of Rentech’s NEWP business, and persuant to the NEWP asset purchase agreement, Lignetics has agreed to acquire substantially all of the assets and assume certain specified liabilities of Rentech, for a purchase price of $35 million.
The purchase of NEWP adds to Lignetics current annual capacity of 650,000 tons. It purchased the Marth Companies in May, which included four pellet plants and trucking assets. The NEWP acquisition will bring the companies’ total pellet plant count to 12, with facilities located all across the U.S.
About Rentech, Inc.
Rentech, Inc. (OTCQB: RTKH) owns and operates wood fibre processing and wood pellet production 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. Rentech’s New England Wood Pellet subsidiary is a leading producer of bagged wood pellets for the U.S. heating market. Rentech’s industrial wood pellet facilities are designed to produce wood pellets used as fuel for power generation.