Saturday, January 14, 2012

renewable energy group inc IPO shares prices january 19 2012

renewable energy group inc IPO shares prices january 19 2012 : The first U.S. initial public offering to step forward in the new year comes from Renewable Energy Group Inc., a biodiesel fuel company that is planning to launch in two weeks. The company, based in Iowa, plans to sell 7.2 million shares of stock on Jan. 19. at a price between $13 and $15. It has applied to list its shares on the Nasdaq under the symbol REGI.

Renewable Energy claims to be the largest producer of biodiesel in the U.S., based on gallons made. It produces the fuel primarily from lower cost feedstocks such as inedible animal fat, used cooking oil, and inedible corn oil.

Renewable Energy, formed in 2006, has grown through acquisitions, purchasing six plants and two other biodiesel businesses since it began.

In the first nine months of 2011, total revenue nearly quadrupled to $557 million compared to the same period a year earlier, but its loss widened to $27 million from $25 million in the 2010 period.

The biodiesel industry relies heavily on federal and state policies that are designed to encourage biodiesel consumption; the largest of these is a federal requirement known as RFS2 that stipulates a certain volume of biomass-based diesel fuel be consumed in the U.S. through 2022. Currently there is excess production capacity among biodiesel plants in the U.S., with many plants not operating or running at reduced capacity. The annual production capacity of existing plants and plants under construction exceeds both historic consumption of biodiesel in the U.S. and the required consumption under RFS2.

The company warns that it has limited working capital and a recent history of losses. It became cash flow positive beginning in the fourth quarter of 2010, but it will need to raise more money to meet anticipated demand for more biodiesel. For the latest updates on the stock market, visit Stock Market Today
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