Boston, MA 06/11/2014 (wallstreetpr) – BioFuel Energy Corp. (NASDAQ:BIOF) and some affiliates of Greenlight Capital Re, Ltd. (NASDAQ:GLRE) and James R. Brickman have entered into a definitive agreement according to gain the equity interests of JBGL Finance LLC and some of the subsidiaries of JBGL Capital, LP from Brickman and Greenlight.
JBGL, which includes both JBGL Capital and JBGL Finance, is a group of real estate entities that concern themselves with the buying and development of land meant for residential purposes. The group is also into construction related lending as well as home building. The series of entities is currently owned and leveraged by Brickman and Greenlight.
Agreement Terms
As per the agreement terms, BioFuel will obtain JBGL for $275 million, part of which is payable in cash and the rest as common stock. A portion of the cash involved in the transaction will be financed from the proceeds that will be obtained from a rights offering of $70 million which will be conducted by BioFuel Energy Corp. (NASDAQ:BIOF). Another $150 million will be funded from the debt financing which the company will be providing Greenlight.
BioFuel Energy Corp. (NASDAQ:BIOF) had formed a special committee of independent directors after it received a proposal from Greenlight and JBGL’s Brickman in March. The committee aimed at evaluating the offer and considering possible alternatives. Duff & Phelps, LLC had been acting as the committee’s independent financial advisor.
Growth Potential
BioFuel Energy Corp. (NASDAQ:BIOF) is expecting to complete the transaction by October 2014. As the transaction comes to a close, the co-founder of JBGL, Jim Brickman, will assume the roles of both the Chief Executive Officer and the director of the company. Brickman believes that the transaction will be transformation for BioFuel, which, he said, will be immediately transformed into an important real estate operator. He said that the company’s stockholders will benefit from this agreement as it offers significant development potential for the company in some of U.S. fastest growing sectors.
