Biofuel Maker Renewable Energy Group Is Said to Field Interest

Source: By Liana Baker, Bloomberg • Posted: Wednesday, February 23, 2022

Renewable Energy Group Inc., a green diesel maker, is exploring options after receiving takeover interest, including selling itself, according to a person familiar with the matter.

The company is working with financial advisers, the person said, asking not to be identified because the matter is private. Renewable Energy has held recent takeover talks with large oil and gas companies, the person added.

If a deal is struck, an agreement could be announced within weeks, the person said. Renewable Energy’s plans could always change and it could still decide to remain independent.

A representative for Renewable Energy declined to comment.

Renewable Energy fell 2.3% to close at $32.62 in New York on Tuesday, giving the company a market value of about $1.6 billion. The stock has fallen about 67% in the past year.

The Ames, Iowa-based company, led by Chief Executive Officer Cynthia “CJ” Warner, turns feedstock into fuel at more than a dozen locations in the U.S. and Germany, according to its most recent annual report. The company’s biodiesel margins have been hurt by higher soybean costs, according to a research notethis month by Bloomberg Intelligence.

The note called Renewable Energy a pioneer that has driven oil majors and refiners to convert some of their plants into biorefineries. Like many companies in the space, it has benefited from biodiesel tax credits in the U.S.

Renewable Energy bought a minority stake last year in a startup called Booster that delivers fuel directly to vehicles.

— With assistance by Michelle F Davis, Ed Hammond, Kiel Porter, and Kim Chipman