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French Tereoes raise finances for bioethanol production

June 25, 2012, Perpignan, France - French bioethanol producer Tereos is raising finance for second-generation production in France by restructuring the company.

By selling shares to boost cash reserves the firm will help pay for upgrading its Bioethanol Nord Picardie (Benp) plant in Lillebonne in the north of France, in order to produce bioethanol from a wider range of feedstocks.

The company said it will restructure by selling 19.7pc of its international arm Tereos Internacional to a series of 11 France-based cereal co-operatives, in order to raise cash of €100mn-142mn, ($126mn-178mn) dependent on the final amount of shares offered. Tereos will then use a third of the money raised, €33.5mn-47mn, to give itself greater flexibility in the production of bioethanol at Lillebonne.

It wants to move away from using wheat as a feedstock — prompted in part by rising prices — with the prime use of the new cash available to boost the ability of its Benp plant to produce bioethanol from an increased variety of starchy waste, wheat by-products and non-food raw materials. Work to alter the Lillebonne unit will cost around €60mn and is scheduled for completion by the end of 2012.

The plant opened in June 2007 at a cost of around €190mn ramping up to use 720,000 t/yr of wheat to produce up to 300,000 m³/yr of bioethanol and another 300,000 t/yr of animal feed. In its 2010-11 reporting year Tereos produced a total of 543,000m³ of bioethanol from nine plants in the EU including units in the Czech Republic and Belgium. The company is projecting 674,000m³ of production in 2011-12.

The share sale will be completed on 25 July and will mean the French cereal co-operatives — some of which are already shareholders of parent company Tereos Agri-Industrie — will have a more direct say in the running of the company's projects outside Europe including Brazilian sugarcane plantations, crushing units and ethanol production.

The 11 cereal co-operatives will include Axereal with a 2.7pc stake, Noralliance (3.2pc) and Theal (7.2pc) and will not be tied to any kind of agreement restricting sales of the shares, meaning 30.4pc of the company will now be in free float.

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