The Dallas Morning News reports that GreenHunter Energy Inc. made the move to give its Houston biodiesel plant to its debt holders to avoid being delisted by the New York Stock Exchange:
GreenHunter said that it transferred all of the ownership shares of its GreenHunter Biofuels Inc. unit to a trust for holders of its 10 percent debentures due in 2012. GreenHunter had defaulted on the notes, and the company’s Houston refinery was collateral for the loan.
The stock exchange had threatened to remove GreenHunter from its NYSE Amex Equities listing if the company didn’t improve its financial condition, and the deadline is next week.
“The reason we waited so long was because we were trying to exhaust all options,” said Jonathan Hoopes, GreenHunter chief operating officer. He said he has been talking to companies that considered buying the refinery, but he couldn’t work out a deal.
The refinery faced a slew of problems. It was battered by Hurricane Ike and faced an import tariff on biofuels to Europe, Hoopes said, and the U.S. allowed a crucial biofuel tax credit to expire.
“Here we sat on a plant that could literally manufacture one-fifth of the nation’s biofuel needs,” but, he said, the company couldn’t afford to repair the refinery.
The article goes on to point out that many other biodiesel companies are in the same boat, losing market share due to the idling of refineries across the country while they wait for Congress to renew the credit.