Rentech, Inc. (NASDAQ:RTK) announced today that it has closed the
previously announced sale of its alternative energy technologies to
Sunshine Kaidi New Energy Group Co., Ltd. (Kaidi). Rentech received a
cash payment of $14.4 million from Kaidi, which is in addition to $0.5
million in cash payments previously received. Kaidi will pay an
additional $0.4 million to Rentech to purchase various equipment
currently located at Rentech’s decommissioned Product Demonstration Unit
(PDU), resulting in $15.3 million of total proceeds to Rentech from
these transactions. This additional transaction is expected to close
before the end of the year.
D. Hunt Ramsbottom, president and CEO of Rentech, stated, “We are
pleased to have closed this sale as part of our cost reduction efforts
and focus on our wood fibre processing and nitrogen fertilizer
businesses. By monetizing these non-core assets, we have improved our
balance sheet and will be realizing significant SG&A savings going
forward.”
The transaction calls for the possibility of success payments to Rentech
of up to $16.2 million. These payments would be triggered if Kaidi
successfully builds and operates, at its cost, a demonstration-scale
plant in China that uses the technologies acquired from Rentech and
performs at specified levels. Rentech and Kaidi will share equally in
any proceeds from the future sale of the PDU site in Commerce City, CO,
net of transaction fees and carrying costs of the property incurred
by Rentech after September 30, 2014. Rentech expects to close on the
sale of the site in the first half of 2015.
The sale of the technologies should increase Rentech’s net operating
loss carryforwards applicable to federally taxable income by
approximately $12.5 million.
About Rentech, Inc.
Rentech, Inc. (NASDAQ: RTK) owns and operates wood fibre processing,
wood pellet production and nitrogen fertilizer manufacturing businesses.
Rentech offers a full range of integrated wood fibre services for
commercial and industrial customers around the world, including wood
chipping services, operations, marketing, trading and vessel loading,
through its subsidiary, Fulghum Fibres. The Company’s New England Wood
Pellet subsidiary is a leading producer of bagged pellets for the U.S.
heating market. Rentech manufactures and sells nitrogen fertilizer
through its publicly-traded subsidiary, Rentech Nitrogen Partners, L.P.
(NYSE: RNF). Please visit www.rentechinc.com
and www.rentechnitrogen.com
for more information.
Safe Harbor Statement
This press release contains forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995 about matters such as
the expected closing date of the sale of the PDU site, future SG&A
savings and the potential for success payments. These statements are
based on management’s current expectations and actual results may differ
materially as a result of various risks and uncertainties. Other factors
that could cause actual results to differ from those reflected in the
forward-looking statements are set forth in the Company’s prior press
releases and periodic public filings with the Securities and Exchange
Commission, which are available via Rentech’s website at www.rentechinc.com.
The forward-looking statements in this press release are made as of the
date of this press release and Rentech does not undertake to revise or
update these forward-looking statements, except to the extent that it is
required to do so under applicable law.
Copyright Business Wire 2014