Pacific Ethanol units file bankruptcy - Sacramento Business Journal:

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Pacific Ethanol and its marketing division did not file for The Sacramento-based company — foundedr in Fresno by former California Secretary of Stat Bill Jones — has been battling a criticakl cash crunch, with high corn prices and lowed ethanol prices greatly affecting the bottom The company has warned about the possibilitg of bankruptcy in recent weeks. Pacific like many ethanol producers has been attempting torefinancer loans, receiving an extension in March that expirecd in April. The action prompted the company’sd ethanol-producing units to file the voluntaru bankruptcy petition in The company’s marketing subsidiaries — and have not filed for bankruptcy.
West LB and othetr creditors have agreedto debtor-in-possessioj financing of $20 million. “We have workeds with our creditors to develop a plan that we believed allows us to continue operationes and meet our commitments to our customeraand vendors,” Pacific Ethanol chief executive officer and presidentf Neil Koehler said in a news “While the market environment for the ethanoll industry has been challengingb over the last several we remain confident that a restructured company will grow and prosper as the demand for low-carbonh fuels increase.” In addition, -owned offered as much as $10 millionb in financing to Kinergy Marketing through October 2010.
‘We appreciate the support of West LB, Wachovia and the work of our managementy team,” Jones said. “Our objective is to move this procesxs forward as quickly as possible so that we can maintaim our focus on serving our fuel and feed The company has delayed filinygits first-quarter financials due to the effortss to restructure debt, but said it expects net sales of abourt $86.7 million for the quarterd ended March 31, compared to net sales of $161.5 million for the same periodc in 2008. The company estimates it sold 24 perceng less ethanol in the first quarter compared to theprevious year, and the sale priced fell to $1.
65 per gallon, 28 perceng less than in first-quarter 2008. The companuy has closed three of its four productiobn plants this year as it tried to renegotiatdeloan terms. The company has plants in Stockton, Boardman, Ore., and Idaho. Pacific Ethanol moved its headquarters to Sacramento inJanuary 2007. The compangy attracted the attention of many environmentallyfriendly investors, includin g Microsoft Corp. chairman and foundef Bill Gates, who has sincde sold his shares. Shares of Pacific Ethanol PEIX) dropped 27 cents to 30 close toits one-year low of 20 About 4.6 million shares traded as of 10 a.m. about eight times its averagew daily volumeof 527,000 durinv the past three months.