Pacific Ethanol Acquires Illinois Corn Processing
U.S.-based renewable fuel company, Pacific Ethanol announced it has agreed to acquire Illinois Corn Processing (ICP) in a $76 million deal that includes $15 million in working capital.
Located on the Illinois River, and adjacent to Pacific Ethanol’s Pekin facility, ICP manufactures 90 million gallons of fuel and industrial alcohol per year, and will bring the combined capacity of the two companies to 250 million gallons per year after the deal closes later this month. The company’s product line includes fuel-grade ethanol, beverage and industrial-grade alcohol, corn oil, and dried distillers grain (DDG).
The strategic acquisition is expected to expand production diversity, expand market reach, and improve profitability for Pacific Ethanol, while also providing about $3 million per year in cost synergies through economies of scale, managing grain supply, and transportation costs for DDG and ethanol. In addition, Pacific Ethanol’s Pekin facility has direct access to end-markets via barge, rail, and truck, while ICP’s dedicated barge terminal will create transportation cost advantages and has direct access to the Mississippi River system.