WestLB's specialist knowledge of ethanol financing helped it remain the lead on White Energy's new construction financing. John Castle, cfo of the Dallas-based renewable energy company, said the German bank did a good job of obtaining reasonable pricing on its $298.5 million financing to be used for a new ethanol facility in Plainview, Texas. He explained that the drop in the value of ethanol stocks over the past four months has changed market conditions for ethanol financing, but said WestLB was able to obtain a reasonable deal for the company.
The new financing consists of a $275 million term loan and a $28.5 million revolver. It replaces a $160 million term loan and a $13.5 million revolver it entered into in August for the construction of other ethanol projects. Castle did not disclose pricing, but said, "In today's market [WestLB] did well to get reasonable pricing and a reasonable structure. The broader ethanol market has gone through changes in the last four months. The value of ethanol stocks has come down. It is a different market now. But it has not become more expensive for us."
WestLB is also the sole bookrunner and administrative agent of the facility. The bank was the lead on the previous facility, which White Energy used to acquire an ethanol production facility in Russell, Kan. and to fund the construction of an ethanol production facility in Hereford, Texas. The construction of the new facility in Plainview, Texas will make White Energy the fourth largest ethanol producer in the U.S. White Energy was founded to develop business opportunities focused on renewable energy sources in the U.S. and aboard.